WE CREATED THE DEAL ARCHITECTS AS A FORUM TO BRING TOGETHER LEADING EXPERTS, ADVISORS, OWNERS AND INVESTORS IN THE ACQUISITION AND SALE OF SMALL AND MIDDLE MARKET BUSINESSES. WE HOPE YOU ENJOY OUR INAUGURAL ISSUE!
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Todd Corbett Smith, founder of CORBETT BRANDS, looks to the future in his first feature article. Over the next decade, over 10 Trillion dollars in business assets will be sold.
In “The Great EXIT,” he shares his thoughts on this MEGA-TREND and what it may mean for Corbett’s clients.
Christopher A. Farrell has been a TRADER in the financial markets for nearly 30 years.
In “SELL WHEN YOU CAN”, he shares his LESSONS from the trading floors of WALL STREET on the ART of the PROFITABLE EXIT.
RESTAURANTEUR MARTY BLOOM has owned 38 restaurants in the BOSTON area over the past 30 years. He has made money on 37 of them.
As a CORBETT BRANDS ADVISOR, he shares some of his wisdom on how to stay PROFITABLE and avoid PITFALLS.
Are you prepared?
By Christopher A. Farrell
Sell when you....not when you have to . I first heard those words as a young trader on a crowded trading floor on Wall Street nearly 30 years ago. The year was 1995. I was 22 years old, on the preferred stock desk at Gruntal and Company, at the time one of the oldest brokerage firms in New York City with a history dating back to the 1880’s. Gruntal was located right across the street from the New York Stock Exchange at 14 Wall. I learned many lessons from that trading floor that still serve me well to this day.
“SELL WHEN YOU CAN, NOT WHEN YOU HAVE TO”
Trading is an extremely challenging way to earn a living. Timing the market successfully is one of the most elusive and difficult skills to develop in part because it requires a bit of contrarian thinking. You have to react before others. This is why most people fail. By time you get “proof” that it is the right time to sell, it might be too late.
A re lessons learned on the trading floors of Wall Street applicable to private deals? In my opinion, the answer is yes. When i joined the Corbett team and got involved in buying and selling businesses, i kept thinking about the similarities between the two worlds. Business owners, in many ways, sit on a knife’s edge. Unlike the financial markets, private businesses are not liquid.
There may literally only be one buyer and thus, only one chance to sell near the price you want. The window to safely exit your business, at a good price, can be extremely narrow. In financial market terms, we call this a “thin market” with a “wide bid-ask spread.”
So how do you navigate this kind of market risk? With caution. While there are some deal terms that are worth walking away from, it is always prudent to think about worst case scenarios upfront. Everything has a price. If i lose this buyer, what are the financial consequences? How difficult will it be to find another buyer?
“There may literally only be one buyer and thus, only one chance to sell near the price you want.”
“The window to safely exit your business at a good price can be extremely narrow.”
We created The Deal Architects as a platform to bring together advisors and experts to discuss the benefits and risks of buying and selling businesses. Ultimately, to help our clients to better navigate those risks. At the end of the day, human psychology does play a role in this process. Fight the urge to go with the herd. The perfect price and the perfect time to sell may not exist. Waiting just a bit too long to get the perfect price carries risks that can jeopardize your exit .
A little contrarian thinking can go a long way.
“The perfect price and the perfect time to sell may not exist. Waiting just a bit too long to get the perfect price carries risks that can jeopardize your exit.”
“A little contrarian thinking can go a long way.”
CORBETT BRANDS is a full-service business and commerical real estate brokerage with national reach, serving New England, New York, Florida and California. With over 700 transactions totaling over $200,000,000, let the Corbett Solution work for you.
Over 700 deals
200,000,000, I N SALES