So a few month’s back I reached out to the QLA Founder who is known online as the one and only Mr. Dan Peña. When I submitted my Questions to him little did I know his answers would be just as entertainingly colorful as his Youtube videos.
Here is the thing. I knew nothing about Dan until one of my close Mentors who himself is a Bad Ass Senior Big 4 Partner sparked my curiosity one day while on a Zoom call in September. Sure I have seen suggested videos about Dan before. But I paid them no interest. But this day I made a note and went to watch what this guy was all about. What I found was? Dan’s videos are about helping normal average non high performers to try and reach or obtain a level of Business sophistication that makes them super wealthy through a methodology called QLA.
Dan’s coaching and teaching videos are also meant to help the Entrepreneurs who struggle with sales so they have a fighting chance. And to toughen up so to speak. Dan is a Military Veteran like myself, he served around the Vietnam era and honestly as a fellow Veteran? Dan is 100% hard as fucking nails.
And so I asked him a few Questions only a Military Veteran would be able to ask. And these are colorful his answers…
Mr. Dan Peña’s Backstory
Before becoming very wealthy by taking Great Western to an IPO on the London Stock Exchange Youtube Sensation and QLA Founder nicknamed the Trillion Dollar Man Him Self Mr. Dan Peña, was busy serving in the United States Army. (DANS WEBSITE)
Dan Peña began his career as a financial analyst on Wall Street. … He went on to become president of Great Western Resources, Inc., a Houston-based oil company eventually listing his Company on the London Stock Exchange. After a Board of Directors shake up, Dan Walked away after the dust settled with a very large multi million dollar pay day. (Dan Peña Youtube Channel) Click pic for Youtube Channel.
I asked Dan many questions. But to keep this article short for all intensive purposes? Here are the answers that have the most value for you. Thank’s DAN it’s a privilege to interview a fellow Veteran.
How Dan Peña Made His Millions?
Dan Peña began his career as a financial analyst on Wall Street. … He went on to become president of Great Western Resources, Inc., a Houston-based oil company eventually listing his Company on the London Stock Exchange. After a Board of Directors shake up, Dan Walked away after the dust settled with a 400 million dollar pay day.
-QLA can it work for any veteran?
ANY VET THAT HAS TRUE COMMITMENT & FOCUS, PLUS HE NEEDS 2 BE REALLY HUNGRY!
-What is the key to becoming Successful and established as a Investor?
SUCCESS IN ANYTHING IS ALL ABOUT FOCUS!
“WARNING” IF you find profanity offensive, and if you have trouble with realizing the truth about yourself? This is not for you. DAN Will not spare your feelings. Read on at your own peril.
-Do you feel being a Combat Trained Ranger Trained Infantry Officer helped you be successful in the tough and difficult world of Investment Finance?
IN THE 60’S, WHEN I WENT THRU INFANTRY OCS, FROM DEC 1966 TO JUN 1967, RANGER TRAINING CAME AS PART OF INFANTRY OCS – BUT WE GOT NO BADGE CERTIFICATION! Ranger TRAINING WAS NOT AS LONG AS RANGER SCHOOL – BUT EXTREMELY INTENSE!
BUT NO DOUBT, IT TUFFENED US UP LIKE NOTHING IN CIVILIAN LIFE! IN THOSE DAYS, THEY LITERALLY BEAT US – PUT BATTERY CABLES 2 UR BALLS – PUSHED U OUT OF TREES WID UR ARM/LEG TIED, 2 DISLOCATE UR JOINTS – PLUS IF CAUGHT IN TERRIST TACTICS, STAKED U OUT ON AN ANT HILL & POURED HONEY OVER U – LEAVING U A COUPLE DAYS! MY BEST MAN ALMOST DIED ON SUCH A HILL!
SUCCESS IN ANYTHING IS ALL ABOUT FOCUS!
-How do you scout for talent?
GREAT POTENTIAL, LEAVE GREAT FACT PATTERNS OF PAST ACTVITIES!
-How do you acquire Deal Flow?
THRU R DREAM TEAM BOARD & R OUTSIDE LAWYERS/ACCOUNTANTS, PLUS R UR BANKS!
-Where do you see your Private Equity Group in 10 years?
WE R NOT PE! BUT QLA WILL BE AROUND 4 EVER! I HAVE BIN WORKING THE MODEL 4 MORE THAN 50YRS!
GOOD HUNTING!
Mr. Pena’s Controversial Teaching methods are honestly how you build winners. The Military Trained him for War, he trains young men at his Castle in Scotland to win.
Did you happen to catch my latest article News interview on the latest Acquisition? “HERE”
I was surprised that Dan truly does want what’s best for all people. And the straight facts are Dan doesn’t like to see weakness within his fellow Entrepreneurs. His twisted love albeit fucking twisted and dysfunctional is meant to be a Soldiers Affection in a way. You have to be a Soldier, Sailor, Airmen or Marine to understand where I am coming from. And this is why so many men who did not serve in uniform find him offensive. Business is fucking hard. And he want’s to transform you to be able to accept the ridiculous rejection you will face if your in any business. That’s why he behaves the way he does.
What is Dan Peña's Military Ranks?
Dan Peña was discharged from the United States Army at the Rank of Lieutenant
To all my fellow Veterans, Men or Women, Bad Ass Infantry or Sailors that man the Conning tower on submarines. Here is a Cheers to you. As I sign off? I hope you found this interview useful, I know I had a blast conducting it. As we say in the Marine Corps. SEMPER FI
I imagine your like myself and wonder “How to be valuable and indispensable to business leaders?”
To drive home my point? I would like for you to take a piece of paper and write down all the skills you personally have, then I want you to write down these words Trust, Loyalty, Reliability. Most college students look for and want a comfy job. But honestly if you have no skills that make you a attractive candidate? You will likely have a very difficult time finding a Company that will want to train you from scratch. Not impossible. Just difficult. You will be out of luck. But what if there was a easier better way? There is Hombre!
If you want to be indispensable to Business Leaders? This post will help you begin that process. This post will detail several Corporate Financial Skills you need to master. Which will make you more attractive as top shelf talent for Corporate Business leaders. Keep reading. This post is written for you.
Can you keep your mouth shut? Can you faithfully complete the mission or Jobs handed to you? Are you loyal? If the answer is no to one of these questions? Your like a stump and deadweight. Your going to be avoided by like the plague. However if you have Financial Literacy, growing experience, and Corporate Finance skills along with a trustworthy good attitude, and you are reliable? You will be a hot commodity and business leaders will be seeking you out.
Got any Skills?
Often times when I am meeting Government leaders in City, State, or Federal office they recognize right away I am a take no prisoners no bull shit type of Entrepreneur. I always keep learning new and useful Bad Ass skills. This makes me a Killer to many Business leaders and Politicians. Being a Jack of All trades has it’s uses. Right now I am studying daily Python Coding Courses and zeroing my sights on Financial Modeling to sharpen my Corporate Finance skills. That means I am sharpening my Business spear. Doing whatever it takes to be a successful team player. And especially adding value for my personal Business Career. I am positive my Partners and Mentors Investment Firm will find my new skills valuable as we evaluate Transactions.
Corporate Finance Modeling
I shouldn’t have to share with all you Entrepreneurs that if your continuing to learn? Your going to be very valuable to Private Equity, Venture Capital, Mergers and Acquisitions Investment Banking, Banks, Big 4 Accounting firms or even within Mergers an Acquisitions. Learning new Corporate Finance Skills will separate your value from most other people. A good Analyst who has experience is highly sought after by large firms. So learning Financial Modeling does have it’s benefits.
“How to learn Financial Modeling?”
This skill alone will propel you above others easily making you a competent Analyst within the Corporate Finance space. I highly suggest you first become Financially Literate before pursuing advanced Corporate Finance Training. The video below, will share some basics Financial Modeling and demonstrate several Different Types of Models.
How to learn Financial Models?
To learn financial models most times a person must just learn step by step within a training program explaining the different Financial Model types and how each model is used. There is not easy way to learn except by doing. This guide can help explain financial models to you.
The Three Statement Financial Model in Detail VIDEO
“The Different Types of Financial Models”
If your anything like myself learning new skills does not come naturally. However with perseverance, time, personal effort and luck? The books, and content you study do tend to start making sense. That growing experience is a investment into your future success. And so let’s make a investment into that future success right now and here on my blog. These are the different types of Financial Models you need to learn if you want to be in Corporate Finance.
The fundamental building block of all financial models is the three statement model. This model includes components that lay out
Assumptions
Income Statement
Balance Sheet
Cash flow statement
Support Schedules
Charts and Graphs
When you look at this model in Excel you will immediately see the Income Statement, Balance Sheet, and Cash Flow Statement are laid out for the purpose of analyzing historical results, Establish Forecast Assumptions, Building the Forecast, Set the foundation for more advanced modeling.
What are Corporate Finance Financial Models?
Corporate Financial Models take mathematical values that are used to calculate assumptions to value businesses and their assets and also for forecasting and budgeting purposes related valuations, debt, equity and other values within business
Discounted Cash Flow Model
The Next type of Model is the (DCF) Discounted Cash Flow analysis model. Or DCF model. This includes all the three standard statement model plus a extra little section all about free cash flow and evaluation.
Components of the DCF Model
Everything as the three statement model
Free Cash Flow (Firm or Equity)
Terminal Value
Weighted Average Cost of Capital
Net Present Value Using XNPV
Internal Rate of Return using XIRR
What is the Purpose of DCF Model?
The Purpose of the DCF Model is,
Valuing a Project, Business, or Investment Opportunity
Determine “How much to pay for a Acquisition?”
Assess the Impact of strategic initiative
Internal FP&A
Raising Capital
What is DCF mean in Financial Models?
A DCF means Discounted Cash Flow Model
Budgeting and Forecasting Models
A Budgeting and Forecasting Model is prepped and used to manage operations in House. It’s usually a monthly type model that monitor the cash inside of a business on a monthly basis. It’s basic forecasting.
The Components of this Model?
Assume Monthly Finances
Drivers of Operations
Three 3 Financial Statements (Previously Mentioned)
Ability to “Roll Forward” the Financial Model
Charts and Graphs for Visual demonstrations
The Purpose of Budgeting and Forecasting Model
Internal Executive Level Planning
Budgeting and Forecasting
Measuring Results and Performance
Strategic Planning
Evaluating Performance of Business
The Valuation Model
The Valuation Model does include a (DCF) and a comparable analysis of a type of Valuation. But also includes these components listed.
Components of Valuation Model?
Comparable Company Analysis
Precedent Transactions
DCF Model
Football Field Chart
What is the Purpose of the Valuation Model
Value a Business
Summarize the Valuation Methods
Create Outputs, charts and graphs for presentation
Present Analysis for Investment Banking & Private Equity Transactions
What is a Valuation Model in Corporate Finance?
Valuation Models in Corporate Finance value the business, summarize the Valuation Methods, Create Outputs, Charts, Graphs and Presentations for demonstrating value of a Business
Introduction to Corporate Finance Course: VIDEO
This is an Advanced Model for Mergers and Acquisitions (M&A)
A M&A Model is a very advanced Financial Model. To start in detail? The M&A Model has the three statement model and plus the DCF Model. And will include Operating Scenarios and Valuation Models and more.
Components of the Mergers and Acquisitions Model
Includes Three Statement Models and DCF Model
Operating Scenarios
Consolidated or Pro Forma Model
Transaction Assumptions Including (Synergies, Financing, take over premium)
Sensitivity Analysis
IRR and Share Price Impact
Accretion- Dilution Analysis
The Purpose of the Mergers and Acquisitions Financial Model?
Primarily the purpose is to evaluate M&A Transactions, Determin how much to pay for an asset or transaction and more.
Valuing a Target Business
Determine how much to pay for a acquisition
Compare Cash Vs. Share consideration
Evaluation Synergies and take over premiums
Asses the net impact of the Acquisition
This is used mainly in Investment Banking and Corporate Development
What is a M&A Financial Model?
Mergers and Acquisitions Finance Models determines how much to pay for a Acquisition, compare cash vs. share consideration, evaluation synergies and take over premiums, asses the net impact of the acquisition, and is used mainly by Investment Bankers and Corporate Development.
The Leveraged Buy Out Model
The leveraged Buy Out Financial Model is a extensive 6 stack of models to give you the absolute best analysis available for layered analysis.
The Purpose of a Leveraged Buy Out Financial Model
Value a target Business
Determining How Much To Pay For An Acquisition?
Asses How much leverage can be used
Maximize the Equity IRR
Evaluate the Scenarios and Sensitivity
Obtain Financing and make a investment decision
This post was written in hopes to give you several main types of Financial Models used in Corporate Finance. I sincerely feel if you learn all of these and continue to learn as a Entrepreneur, as a Corporate Finance Analyst or Investment Banker? You will be valued and needed inside Private Equity, Investment Funds, Investment Banking, Wall Street Boutiques and even Big Firms like Blackstone and the Big 4 Accounting firms. Please take what you want from my growing experience. And Use it. It is a privilege you shared a little of your time here and found my blog useful. Thank you. And to all the Business leaders inside the Corporate Finance or Business Space? If you are needing some Professional Skills that I can provide? Please contact me “HERE” . I would be happy to help. Thank you for reading. Godspeed.
If your a Entrepreneur you better believe you will be under the microscope financially when handling other People’s money. And this is how you stay safe and stay lawful in the process.
First you need to understand my tone when I am writing this Post. It’s serious fucking business. Admittedly I am known for not being a push over and being a little edgy at times. But someone must demand excellence from others. The Military was responsible for beating this into me. So if your sensibilities are chapped or offended? Maybe you should not read this article. And this article is NOT LEGAL ADVICE.
Many entrepreneurs do not stop to consider how their ignorance, and inflated ego is causing their own limited growth or certain failures. If you are pandering to the general public for social media likes. You are not fooling anyone. As a matter of fact you are alienating real business opportunities and real qualified investor opportunities.
Real business people in your community are always watching your every move. They know a fucking Fraud from a real struggling take no prisoners entrepreneur. There’s wealthy individuals, Investment Partners, and finance professionals in your community who are incredibly sophisticated financially. They know a real authentic Entrepreneur from a social media fraud.
Live by this advice. Be authentic, be incredibly generous and politely carry yourself with absolute class. Watch your movements and how you do business. Have some pride and help your community.
If your in the column of qualified or Accredited Investor from the SEC? And you would like to share your informed opinion with me how I am right or wrong in this Post? Im positive I would be open to it. Please Email me. 🙂
And if you have read previous posts from my Blog? It can not be stressed enough. How important recruiting a successful community leader and Mentor is! It’s so important you will be doing yourself a disservice if you do not recruit a mentor in your community.
Still most Entrepreneurs do not know what they are doing. So If you do not know what your doing? Recruit professionals who do know what they are doing. This post is meant to keep your professional reputation intact. And keep you safe from criminal investigations that may end with you locked up in a jail cell and labeled a fraud in the local Newspaper.
What you should not be doing?
The Following suggestion of mine, is what you should NOT be doing if your a Entrepreneur who is seeking fundraising for your new startup. If you want to be successful? The following strict bullet points are suggestions you should take to heart.
A. You should not be approaching wealthy community members with a idea that has no proof of concept.
B. You should not be selling yourself with the next FACEBOOK idea to the wealthy in your community.
C. You should not be accepting any checks or money from anyone in the community without a team of pro’s.
Under “NO CIRCUMSTANCES” do you ever fundraise in your community alone with just an idea. This will always end badly and if you ask me? Is tantamount to criminal fraud in the highest degree. You have no business taking money from anyone and managing funds in a business checking account if your a new fresh entrepreneur. Are we on the same page? GOOD!
If you are not humble and not reliant on Business Professionals? It’s likely you will end up on American Greed as a failed Entrepreneur and Criminal. So do everyone a favor. And do things the right way. And for “God’s Sakes…Don’t be a Instagram Playboy. That Screams Your A Fraud and Criminal. Your Welcome.”
What steps should you be taking as a Entrepreneur?
You should be interviewing Professionals in your community for the right “fit”!
Before we can advance, I need to drive home the importance of this step. This will provide you a few professionals you will need to recruit if you are starting a business. This formula will not fail you and using this formula will keep you safe legally. It will absolutely boost your community presence as someone to take seriously and will begin to create a positive buzz about your business venture. So please take my advice and use it. It pays massively overtime and will begin to make you a trusted community voice and leader.
The reason I lay this out here is because..Many people in your community will dismiss you as someone to take seriously. In todays environment of Bull Shit Social Media Posts and Online Con-Men and Con Women? If your not squared away with a team of Professionals. People will gossip about you. And will privately call you a Fraud and speak poorly about you. Until proven otherwise.
This post is meant to give you the Entrepreneur real direction on how to fundraise and become a success. Their are literally so many criminals and frauds in the business entrepreneur environment and on social media. You will likely be judged as just another “CON MAN OR WOMAN” until people can clearly see your helping your community with a team of professionals in tow. So beware.
Recruit a Business Attorney
First step in your business entrepreneurship career is to interview and recruit general advisory legal counsel. Having a Business Attorney close to you will ensure two things. You stay out of legal hot water, and you will have an established advisor help you negotiate decisions in business. This alone will negate most of the problems you face in business. My personal Attorney is a Bad Ass. We have worked on a Inner City Mayoral Political Campaign in the past. He is Corporate Counsel and always available when I need him. And honestly speaking? Also available as a Team Mate when I visit and am invited to high class Cocktail Business Receptions with our City’s elite.
The benefits are 100% GOLD! Your counsel’s advice will help you along the journey. Keeping you safe from making stupid mistakes. And when it’s time to start accepting checks form Investors? He will know how to create Legal Documents to keep you safe from legal action or worse. Criminal Investigations.
Difficulty of this process?
Look everything has a downside. I am not saying call up your local Big Law Firm and try to recruit a $900 an hour corporate attorney you don’t already have a relationship with? Not what I am saying! Find a small Business Attorney in your City someone you already know who is a trusted Business Attorney or Someone you trust to introduce you to a Attorney. Telephone the Attorney and go to lunch. Be prepared and ask relevant questions. Look for the right fit for you. And establish a trust based Relationship moving forward. It’s too easy for you inexperienced name to be dragged through the MUDD by not having the right professionals around you. Capesche? Good!
Small Trusted Local Accounting Firm
Ok let’s say you have began your Entrepreneurial mission, you have been preparing the community for fundraising. Your next step is to begin searching and visiting small local “TRUSTED COMPETENT” Accounting Firms. Having a small trusted and competent accounting firm to handle all financial aspects of bookkeeping and payments is extremely vital and a cornerstone to your success as a Entrepreneur. If you will be handling any money from Investors? Your small accounting firm and your local general counsel need to be working with you and together. If you accept a investor check from anyone you need these 2 people at that table. Or at the bare minimum involved. A. Your General Counsel and Attorney and B. Your Local Competent and Trusted Accountants. I would also have the meeting at the Office of your Attorney or Accountant. This is my advice.
This will prevent you from having any problems moving forward. But if you want to play it safe and keep your reputation from being dragged through the mud? You must take this advice and use it. And for the record you should already have a business plan on the table before you accept a check from any investor. It’s just good business. Many entrepreneurs who do go the start up route? Do not understand that it’s foolhardy to sell a start up idea with no numbers or no proof of concept. If I were you? Don’t ever sell a Start up idea with just a piece of paper and a idea. Never approach investors with just a piece of paper and a idea.
YOU NEVER HANDLE FUNDS ALONE
Let’s say for instance your Business is on it’s way to being a start up. Since your startup business is it’s “OWN ENTITY”. The role of the Controllers? Controllers are the people inside the business with authority to approve or deny spending of funds for your business entity. You will need A. A Controller who’s integrity is professionally sound and someone that has previous experience. And B. You should in good conscience stay away from handling funds alone. Always have another signature and confirmation for spending funds or approvals. To play it safe? You should have at least 3 individuals who are responsible for the spending or denial of dispersing funds. And at any time 2 of these individuals should give permission for the business to spend any amounts of money over say….$500 dollars. This keeps you safe as a entrepreneur and will keep you legally out of trouble.
I would choose 2 Accountants as fellow Controllers of the Business checking account. This is the safe route. And will ensure your business is safe at the end of the day. I can not stress enough how important accountants are to your business. Because you will need to pay your Employees and need to file “TAXES”. So they are extremely important to your startup business.
Here is another reason I suggest having a trusted local Accounting Firm as partners in business? They will invite you to spend time with other Business owners. This begins to establish your trusted name in the business community. And if you ever need a referral to another business professional in your community? They are there to help.
In conclusion you likely are beginning to see how important it is to have professionals in your business career. If your going to be handling other peoples money in Business and as a Entrepreneur? It is mandatory you use this post as a rough blue print and direction you need to take to A. Stay Safe Legally from Criminal Probes, and B. Building your Professional Reputation as someone Trustworthy in your business community. Because all things considered to many Entrepreneurs I meet “HAVE NO CLUE HOW TO RUN A BUSINESS” or are “Financially Illiterate”. This will help start you on the right track and begin to help you move in the right direction as you stumble along as a Entrepreneur.
If you are a Entrepreneur, Accountant, Tax Attorney, Businessman or Wealthy Individual you already likely know what the 6 Assets you should list on your Financial Statement? Great! But if you don’t know? Maybe this is an article you should read. Because I am going to dive in and share what these 6 Asset classes are?
The six asset classes you want to include on your personal Financial Statement is not only Real Estate property income. But it’s also other income streams like Stocks, Bonds, and definitely NOT your home. We will dive more into this later. You will want to stay tuned because I am preparing you to become a Financially Literate confident business player.
Ok So I appreciate you showing up and reading my Blog post, I do believe I am beginning to have a few heavy hitters from Wall Street read from JP Morgan. I appreciate you guys. 100% And I Thank you. So back to business here. What are the 6 types of Assets Accountants and Business Personalities list on their personal Financial Statement?
Let’s start with an activity as we dive deeper into this thought of what is the six Assets a business individual needs to list on their Financial Statement? And by the way when you finally have enough money and assets to fill out a Financial Statement that day when you see it take shape is liberating. Absolutely. If your just realizing one day that you Made a Million Dollars in one year? This video by Patrick Bet-David is for you. Watch It!
Ok let’s get back to Asset’s. What are the Six Assets types you should list on your Financial Statement?
Bank Accounts
Bank Accounts mean your Personal Bank Accounts, not your Company Bank Accounts. It should go without saying that Commingling Bank Accounts with your Company’s money and Personal Money should never happen. I hope I don’t have to explain. It’s just bad for business. Capeche? Great Moving on.
2. Stocks
Do you have Stocks in the S&P or an Account with Charles Schwab or Edward Jones? Or even Robinhood? Then you will want to individually list each in Subsections on your Financial Statement. I hope your learning this is the Big Leagues.
3. Receivables
If your a business owner or you have personally loaned money out to your Community your going to want to list Receivables. To take this definition a bit further and be more politically correct with the Accountants who will read this. I grabbed this definition from a reputable source online. Receivables is the balance of money due to a firm for goods or services delivered or used but not yet paid for by customers. Accounts receivables are listed on the balance sheet as a current asset. (R) is any amount of money owed by customers for purchases made on credit.
4. Real Estate
Ok this one could be tricky for most who are out there and do not have an Accounting Background. But when your listing your Real Estate assets on your Financial Statement you need to list them correctly. What do I mean by this? We want you to list your Real Estate Assets in a selected manor. Meaning take the Fair Market Value of your Real Estate Asset and write this number down. Now make sure you do not include the sum of the Mortgage you still owe on the Asset or Property. Make Sense? Ok Good! Speaking of Real Estate I want you to go check out this Madman named Ben Mallah.
Ben Mallah’s Youtube channel all about Real Estate is surely to entertain you with how crazy it is. LOL Here is a video from his Channel. Between you and me, I have told Ben several times how much I appreciate his crazy Youtube channel and him as a Investor. He is a solid Big Loveable Bear! LOL Ben taught me personally about 1031 Exchanges and Deferred taxes. These topics will be a post all on it’s own.
And for our last 2 Asset type’s you should list on your Financial Statement? Drum Roll……!
5. BOND’s
It should go without saying you should list your Bond assets on your Financial Statement. After all it is a legitimate Investment Asset. What is the proper definition of a Bond? I grabbed this online and this should help with describing this asset class. Bonds are units of corporate debt issued by companies and securitized as tradeable assets. A bond is referred to as a fixed-income instrument since bonds traditionally paid a fixed interest rate (coupon) to debt holders.
If you need to brush up on the How the Bond Market Moves and Operates? Please be sure to check out my former post on the subject. Here!
6. Business Value
When sharing this Asset type on your Financial Statement you should consider that you want to share the (NET) Value of your Business. What you listed on your Tax returns. NOT what you think it’s worth. To many business owners I meet have a value that is unrealistic. And fail to consider thier EBITDA and other costs. It becomes a big mess in the end and certainly lead you down to having unrealistic expectations. Be honest and be straight about your Busienss Value. That’s the smart play.
What is the definition of Business Value? It is the standard value measure used in business valuation. A Partner with PWC shared with me today, business value is the entire value of the business; the total sum of all tangible and intangible elements. Examples of tangible elements include monetary assets, stockholder equity, fixtures, and utility.
In conclusion you should have picked up some good information from today’s Article and Post. Generally speaking if you look at the Cash flow, and asset patterns on your Financial statement and the Assets you list on this Accounting form you can see where your lacking and where you should add a little value of shore up weaknesses. Thank you so much for reading and IF you have any questions or Requests? Please email me at JamesonDocSharp@Gmail.com and please tell me if I am missing the mark or really making a difference? I love helping others in Business. In fact with so many people who did not help me and blew me off? I feel it’s my duty to be open to helping others.
Thanks everyone Take Care – Please Comment, Like, and Share. And I will catch you on the next artcle.
If your not sitting down with your Business Partners to collaborate on direction, agreements, leadership and other terms once a year? Your likely setting your business partnership up for certain failure and possible major disagreements. If your willing to ask hard questions up front and use my suggestions in this post? You will walk away with a impressed Business Partner and a solid relationship foundation moving forward.
Accounting is Accountability
I am very aware most Entrepreneurs in small business more than likely are Financial illiterate. They have no way of knowing what they are doing right and what they are doing seriously wrong. The first step in building a Financial Foundation is to take a Accounting class online or at a local community college immediately. Having trouble absorbing the information? Take it two times if need be. Learning these lessons are the foundation for business literacy. Education will begin your financial knowledge foundation. This simple task is often over looked and sadly dismissed as unnecessary. Usually by ignorant and or over confident entrepreneurs doomed from the beginning.
Your Accounting course will begin shaping your thoughts and questions in finance and business. Meaning you will become curious and personally teachable like myself. Figuring out through extended time and gaining more experiences “How business really works.” You need to be aware of when you may be getting robbed in a Board room and a fancy pen with unforgiving businessmen who have blank unemotional faces. I know what your thinking? Harsh? Yep! But I have to prepare you for the reality. I know you probably think I am completely nuts! Because of me slipping that in there. But truth is I have to keep you on your toes.
Being able to take raw numbers and data organize them in excel spreadsheets. Is how you make sense of business numbers and Profit Loss P&L Statements and more projections. Most entrepreneurs fail to consider metrics and numbers. When you can evaluate and know the numbers. This undoubtedly makes you more valuable and attractive as a Business partner. Speaking of partners and investors in business? Your bound to have disagreements. But most times its easily negated by active listening and personal collaborating.
Are You Creating Your Own Business Disasters?
Maybe you have been building your business, maybe you have spent your life savings and built a nice little business with a income stream to match. But you have one problem. Your margins are not allowing your business growth. What do you do? You have a few options. Keep growing at a small rate over time. Risking possible bankruptcy. Or B. Recruiting a Business Partner who can invest Capital or other possibilities to help you grow it fast. Example: Let’s say hypothetically your sitting at a table across from your new capital partner and She or He offers you $150,000 dollars to begin scaling the business. Do you take the money? Or do you ask more questions and try to collaborate? It seems likely many Small Business owners have difficulty in situations like this. If you go look at Business Equipment Financing websites? It’s littered with confused entrepreneurs who have made poor capital decisions. They just did not ask enough questions and did not use metrics.
I would first ask A.”How can we grow this together as a qualifying collaborative question? And B. “What are you looking for in return for investing this money?” Asking these starter Questions are great because they take you deep into collaborating together. Building a solid partnership. But for now let’s hypothetically say you do not take my advice. And you end up….Smiling at your new partner, take the check shake hands. Leave the meeting. And get busy scaling your business to new heights.
But! There is a problem. YES!! YOU HAVE A HUGE PROBLEM!! You have have no mutual understanding. And you have “NO PARTNER or Terms AGREEMENT!”
Agreement’s Mean Collaborating.
Ok let’s say you left that meeting deposited the 150 thousand dollar check in to your business account and began scaling your business right away. A little time goes by and your small business is honestly becoming bigger than you ever thought. The stream of cash flow coming in to your business accounts receivable. It’s powerful. LOL It’s wonderful. Then you get a call out of the blue. It’s your Partner. He or she is confused and annoyed and down right borderline furious. Your partner wants to know “WHY THEY HAVE NOT GOTTEN ANY INTEREST’S PAYMENTS?”
You assume you have been a responsible business owner and think to yourself “No problem. I got you!” And ask your partner “How much do you need for interest payment?”. Your partner responds “I need 25.00% percent on the principal.” And just like that! Your life and future business starts to crumble and spiral out of control all from the fact you failed to negotiate terms on the money. And you failed to negotiate your Partnership Agreement. Whoops. Shaking my head. Now you begin seeing doing a little prep work goes along ways.
The Sit Down
There is a reason the Italian Mafia or Cosa Nostra was very effective in business. They were great because they had the sit down! They had behavior Guidelines. Michael Franzese has some genuinely great content. I would highly suggest reading his books.
In the video above your gonna learn some invaluable business advice. And I mean invaluable. So pay attention Capeche? Good! Im gonna stand on my soap box for a second here and share with you some invaluable advice and experience. So pay attention please. In the Military you learn real fast that you will be punished severely for not taking responsibility for anything and everything and everyone as a team. So I suggest you take responsibility for your partnership and team. Recruit a Business Attorney to help you negotiate and prepare your interests for success. Instead of ending with headaches and certain failure.
Did you miss my Post about Creating Trust in Business Negotiations? It is a must read for anyone in business.
Back to military service punishments for a second. This is funny in a dark way. Their is a underlying theme to being punished in the military. And this transfers to almost every other part of your life. You are responsible for your behavior and all your future outcomes. This means taking responsibility for anyone, everything, and everyone associated with a goal in mind as you move to that objective as a team. If something falls short. Your mission is disrupted by a mechanical failure. Something breaks? Doesn’t work correctly? Even if something isn’t your fault? Step right up! Spin the wheel of certain misfortune. Guess what? It’s your failure! No one else’s. lol It’s 100$ definitely a cruel way to learn. But it does work.
The Knapkin Contract In Business
If you don’t have a contract or a Agreement written down? Tough Luck! Your Busted Out! Don’t be the victim.
Back when you first sat down and your Partner offered to give you $150,000 dollars to invest in your business. You should have taken the initiative to draw up a knapkin agreement. Negotiate favorable and collaborative investments terms while writing these terms out on a piece of paper at the table with the person offering you the money. You can do this in a Restaurant or anywhere a knapkin is available. At the end of your desired agreement you both sign this binding ad hoc legal document. Then take this document and have your Business Attorney finalize it as a formalized, and signed. This is how you should have done it in the first place.
Capitalize on this opportunity. Don’t ever feel the need rush things and always make counter offers. And do your best to prepare questions and what if’s to protect yourself and your new partnership moving forward. I hope you did gain something or some foresight with this post tonight. Thank you for reading everyone. Please do suggest a topic you would like for me to cover. I would be happy to do so. Email me at JamesonDocSharp@gmail.com
We would like to Thank Feedspot for naming my Business Blog 97 of the Top 100 Business Blogs Online!
This is a pretty unique opportunity to be included with Business Websites like Entrepreneur and INC.com. I appreciate the opportunity to be taken seriously as a Businessman and Business Blogger to watch. Thank you Anuj Agarwal and his team at Feedspot Blog. Blog.Feedspot.com
Did you catch me on International Business TV 2 weeks ago? If not? Click here for the full story and video.
Here’s the sad reality of calling large law firms as a local unknown Entrepreneur. Usually when I place a call to a one of several large M&A Law firms in Kansas City. I am usually immediately met with sometimes challenging impersonal and impatient attitudes. The Attorneys at these Law Firms forget they need our Business to stay in business. So if I may offer some guidance when doing exactly this, calling M&A attorneys. I would start with keeping the conversation as impressionable as possible. And about your mission. Become personal only after you meet them in person.
When a Business Attorney finally does pick up the phone or return your email do be Respectful. Be Firm and gently ask your questions while asking for their permission to help you both crush the marketplace. Service through cooperation. The above video shares some opinions about why a large law firm was having issues staying in business. Even though Im writing to share my experiences and some suggestions. I would share My opinion is just that. My opinion! I have a 1st amendment right to speak about the issues I have personally experienced with attorneys. I am not advocating all Attorneys are deceitful or bullies. But you must be careful who you select and who you place your trust into. Because they will try to get away with unacceptable behaviors at times. So please be informed.
There is one thing that stands out to me as a Entrepreneur and Business owner. And that is you must have a backbone and be able to work with aggressive and borderline disrespectful Attorneys. This post will share with you some of my experiences working with and selecting Attorneys. Some things to watch out for. And what to do if you feel outmatched or taken advantage of. Im not going to pretend that most Attorneys don’t have an adversarial reputation of treating people poorly. Not to mention they routinely treat serious entrepreneurs with judge-mental disdain. So with this information being brought to the table of discussion. I feel it’s my obligation to share with other Entrepreneurs “How to handle attorneys who are aggressive and treat you poorly”. Stay tuned this is gonna be worth the time and energy to read. It may just save your business career.
I would like to share a personal experience of mine. This experience had a profound impact on me to the point of knowing I could never allow any Attorney basic trust until they proved themselves worthy of my trust. Being completely honest. I feel you damn near need to hire counsel – to talk to counsel. LOL I do hope your having a laugh with this pessimistic tone I am projecting in my writing here.
Your going to find many Attorneys will likely prematurely and unfairly judge you. Speak down to you. Aggressively try to intimidate you with verbal or emotionally charged statements meant to covertly bully you. You will likely have Attorneys feign being nice while demonstrating micro aggressions during conversations. I do not deny I find most Big Firm Partners unworthy of trust. Until otherwise they can prove worthy of my trust. So this has been my experience. And I am sure most who have had to deal with large firm partners will agree with my observation.
But with all this said. You will eventually find Attorneys who will go to war for you. And these awesome Attorneys will do whatever it takes to make sure you and your interests are represented just like a good soldier on the Battlefield. Plus they will treat you like the Prince or Princess you are.
So do take this information and experience I am providing. And use it as you select, interview, or work with M&A Attorneys.
Here is some basic advice from me for you the Entrepreneur. To use when choosing and searching for a Mergers and Acquisitions Business Attorney.
Not all Business Attorneys are the same. Choose your M&A Attorney based on the Previous Transactions they have completed. I will let you in on a little secret in the M&A space. Most Partners at Big Firms will assign your transaction work to their associate attorneys. Making them do most of the work. All the while smiling and sharing with you how hard they have worked.
Furthermore It’s good to personally know and have lunch and dinner with your Associate Attorney who is doing most of the work for your transaction. They can be your warning alarm if things go sideways. In the end this associate Attorney will form a bond with you. This can be helpful during On & Off again negotiations or other times when you need that Associate Attorney to share “What you can do”, instead of “What you can’t do”. I hope you get my drift.
Carefully select and interview the Attorneys and Firms you want working on your transactions. Make sure your a good fit for each other. Do you have good rapport? Be choosy. Don’t rush things.
So many M&A law firms use templates for Transactions.
Never ever pay for Up Front Fee’s without negotiating a billing agreement in place. Some Attorneys will bill you for the privilege of talking to them. This is a NO GO!!! NEVER EVER allow them to pull a stunt like this with you.
Never go to an Attorney to be educated. This can and will cost you big time. Most Attorneys bill by the hour. If you seeking your Attorney to educate you? That will probably be the most expensive education you will ever receive. All the while they will smile and thank you for the opportunity.
Make sure the Attorney your working with welcomes the opportunity to work with you as an Entrepreneur. You can easily test their mettle and authenticity. By asking if they have provided entrepreneurs in the past the same courtesy as you. And if they have? Ask them nicely to introduce you.
Don’t expect your Attorney to want to be your friend. It’s likely they won’t want to be. Usually Attorney’s are unfriendly to Entrepreneurs unless you come in with Heavy hitters on your left and right.
Always have a Mentor or fellow Board Member present when dealing with Business Attorneys. They are very used to taking advantage of Peoples ignorance or inexperience.
Don’t be a bumbling fool who calls themselves a Entrepreneur. Never try to impress your Attorney. They won’t care anyways. And will likely assign disrespectful and profane pet names to you when your not around. I have seen it.
Never allow a M&A Transaction Attorney the privilege of meeting your Mentors or Board members alone. Keep everything documented. And do be suspicious of any Attorney you do not know well. It’s so easy for people to cut you out of Transactions. In the end without the support and leadership of your Chairman? You are the weak link. I have seen this happen unfortunately. It’s not pretty.
One last thing….. Be suspicious of money matters and always use other Attorneys for your benefit. You want to be a informed Entrepreneur with second and third opinions.
Please take these suggestions as loose suggestions only. Be informed. And it may come in handy one day when you have a suspicion that well founded. I would also look for my other post about “Wall Street Attorneys as Secret Weapons” read that as well. Thank you for reading. I do hope you find an Attorney who is suitable and is a proper and comfortable fit. After all they are one of the most important puzzle pieces to have as a Business owner and Entrepreneur.
So you would like to improve your negotiating and communication as a Business Entrepreneur? I got you covered. Read on
Be Choosy Who You Take Lessons From
Some Internet Guru’s will share this strategy, which instructs you to keep Emotion out of your Business Negotiations. But the truth is? We all know very well emotion drives many individuals conversations. With these suggestions, personal strategies, and books I am sharing. I can only hope you would Thank me one day for this information I am revealing here. After all I have been a Entrepreneur most of my life. And this knowledge has taken me a lifetime to acquire. So I do hope you appreciate the honest approach’s I use when communicating and Negotiating in business.
If you stop and really think about conversations with other humans. Every conversation with someone is likely a Negotiation of some sort. So what should your strategy be? Let’s take a example and expand on this thought. We first need to ask. “Should you be so detailed about sharing your wants that you get lost in the weeds?” Answer No. That isn’t likely to work whatsoever. However if you seek to understand the person your communicating with. You will likely land on the details, needs, and wants of the other person. And after you listen to their needs and wants. You should repeat this information back to them. And it’s very likely the person will love you for this. Gaining you trust and respect. This is much better than just talking with no strategy at all.
Seek To Understand Others
Seeking to understand always will be a smooth way to communicate empathy. Rather than talking with no direction or strategy. It seems appropriate to introduce a businessman and friend. He was generous enough to follow me on Twitter, then made me understand. I should always seek to understand people needs and wants as a strategy during Business negotiations. This will help you more than just talking with no direction. Most importantly implement the use of empathy. This good man’s name is Mr. Marcus Lemonis. Marcus is the CEO of Camping World. Has his own TV Shows on CNBC Networks. He runs his own Investment fund not to mention is fantastic to contact when needing direction. The one thing that makes Marcus wildly successful? Is his understanding that to be able to communicate effectively and efficiently.
Listen Intently
Honestly I have had issues in the past listening to others. So sure! I have forgotten to use my own lessons at times. But this lesson is critical for your success. You must listen intently to others. Listening allows you to seek to understand the other persons needs and wants. While being honest and collaborative. Marcus has always taught his people using manipulation tactics from Internet Gurus will be seen as unnatural and extremely manipulative. Be very careful who you accept your information from. In the current environment of internet marketing content. It’s best to take your lessons from a Man who has business credibility and a proven trust worthy track record. Marcus is one of several proven leaders I look to adopt lessons from.
Another Personal friend and Professional I must mention is US Army Major Chase Spears. Chase has his own Communications & Public Relations consultancy, is a writer and Warfighter. And as an Officer serving in the United States Army, Chase has shared with me personal lesson’s that no doubt helps individuals communicate more efficiently not to mention effectively. Be about serving those your speaking with. While being helpful to these professionals in your daily communications. It pays massive dividends.
Servant Leadership
Having the ability to be a rock solid leader and be known to demonstrate strength is all about being a servant and leader combined. Serve others needs and they will respect your availability. Another nugget of advice that does help during negotiations. Is being completely transparent, but firm. Never deviate from this. People do not respect a leader who is not firm. I know your probably concerned about others ability to be dishonest during negotiations. However there are ways of identifying if a persons negotiating behavior is being dishonest. To help you read this book here. Chris Voss “Never Split the Difference” . This has been my foundation for negotiating and communicating. Mr. Voss’s book & experience is world class. The lessons in Never Split the Difference, are simply invaluable to me.
Be Approachable
Be the man or woman everyone can call or personally approach if something your working on is not moving forward like you thought it would. Being known as the woman or man who can fix situations. Is a fantastic reputation to have. For example: If your team has been inundated with requests to keep your business plan moving and someone or a problem develops that could end your career? You must know how to competently be the guy or gal everyone looks to when problems need to be solved. Let’s be realistic for a moment. Most employee’s are scared to death of making the wrong decision. And honestly they go about their business and put the issue on the back burner. They would rather neglect the situation. Than face upper management and negotiate a plan of action to remedy the situation. Be approachable for your people and others during transactions. It pays massive dividends.
In conclusion summing up the all the little personal pointers on Earning a persons trust during a Negotiations. A. Choose carefully who you adopt your lessons and information from. It could boost your future success. B. Do be detailed when communicating with others. C. Repeat back to the individual their needs and wants will earn their trust faster and respect. D. Seek to understand them and their position. Once you have clearly demonstrated your willingness to understand. You immediately become more engaging. And it’s likely they will come to you in the future. Because you took the time to “LISTEN”.
Thank you for reading, if this article provided you with skills and information you found useful? Please be sure to share.
Warning this is a No Bull guide to recruiting an Accountant that is World Class. And will take ownership when they need to. So dial in and read carefully. I would also trust but verify during due diligence. Always.
It’s vital for all entrepreneurs to have a close friend and advisor who is a Rockstar Sr. Partner of one of the Big 4 Accounting Firms. Or if this is not accessible to you as a Entrepreneur. Recruit from the pool of Partners at large Regional firms who are professional Business Advisors and Tax Advisors. Be mindful its good to have at least two professional accountants who are experts in Tax and Transaction Advisors. And a Tax Attorney for good measure.
Who do you look at as a Possible Partner to approach?
This post is going based on my experience since I have had to do this several times being I am a M&A Entrepreneur. The best qualifications for Partners of Accounting firms you targeting as a Entrepreneur? Don’t actually begin with fancy Degrees or Elitist College. I will say it’s nice to have a Partner Accountant who has this, but in my experience it’s not needed. But what is needed are 2 qualities. And also need at least 10 years of Transactional Experience. Interestingly Partners of big firms often are often sought after. But to me this is a huge mistake. Just simply from the life experience they possess and leadership from their life at a Big Firm. They honestly are secret weapons in Entrepreneurship. We are lucky to have two Big Firm Sr. Partners from PWC and KPMG on my team. They are named John M. And Tim O.
A. Transactional Experience. When a Partner served years as an Associate with their firm. More than likely they spent years cultivating and crafting their advisory experiences. Forming personal relationships with many Senior Executives across the world as they work closely together. Due Diligence during and before Transactions are where they will be extremely effective as you build your investment group or business foundation as a Entrepreneur. Search Funds usually have Accountants with experience mentor Search Fund entrepreneurs along their search.
Accountants are also your best friend when it comes to Business accounting practices, also it’s important to have their guidance, advice and looking at Taxes and the path forward for your venture. It’s absolutely vital an Experienced accountant be present when looking at deals and transactions. No excuses period.
B. Your accountant should have solid integrity. Meaning if he exaggerates in any way during your first 6 months of knowing him. Discard and start over with new interviews immediately. Integrity to me is the ultimate qualifier. If I can surreptitiously evaluate our conversations. Along with our advisory content while listening with my gut feeling? You will know if you can trust this Accountant and partner. Then monitor their performance as needed.
What professional experience matters when considering an Accountant?
When choosing an Accountant one of the Men who taught me how to be a super informed Entrepreneur is my fellow Navy Veteran and Naval Officer the Honorable Mr. Ross Perot. Navy Lt. Perot shared in his Book “My Life & Principals for success” Ross Perot shares in the book “Employ a First -rate accountant. Absolute loyalty and integrity is essential. They should be detail oriented. Excellent Grades in College. Both a CPA and Law Degree Specializing in Tax and corporate law. Experience with a major CPA Firm. END.” Now Ross likes accountants with Law Degrees. I would say it’s fine to have a newly retired Partner from large firm. And a TAX M&A Attorney to cover your bases. But definitely have one of Both. But for this purpose of Accountants? Definitely recruit an Experienced Accountant from a large firm. You should be safe on your journey after you heed this advice.
How a new entrepreneur can get the best Accountants to interview?
How does a entrepreneur with NO Business experience and No impressive winning Credentials or Track record for that matter. Go out in the intimidating business world and schedule interviews with super successful Accountants for your growing team? I would like to offer a solution that worked for me. Ok Now this is very personal. So I do hope you take this hard fought wisdom. And use it wisely. And pass it along to struggling entrepreneurs. But first let me tell you something about personal commitment. I went out in to the crazy big world researched for months possible candidates who would possibly be a good fit as a partner & mentor. And in the end I amazingly Recruited an American Billionaire just from a cold email and cold call. Ya that’s bragging rights right there. lol But I digress. In order for you to recruit a world class Accountant. I would hope you have some sort of track record to bring to the table. And if you don’t your not out of luck. I would first focus on partnering with a local Ultra Successful entrepreneur. So at least you have something attractive and a fraction of credibility.
What is the most important issue when interviewing the Accountant?
This will be very short. The most important issue is deciding if the Accountants natural energy and conversational flow. Compliments yours. Do you have a good feeling? And make sure your gut tells your inner voice they are a good fit. Make your decision only after 3 or 4 interviews.
What questions should you ask?
Have a list already prepared. And do look at some of the points I have previously mentioned above in this How to guide. It’s all really up to you. However if you really want to ask some deep diving questions? Have the Accountant tell you about their career progression. And ask about some of the transactions that were the most enjoyable. This should be a great start to a great relationship.
I do appreciate you reading this far into my disruptive pattern of thoughts and advice. If you received something worth your time here? Please be sure to comment, like and share the Article on Linkedin or whichever social media platform you use. I do not get paid for my Blog of growing Business experience. However I do like to write about things that I have learned. And I hope just maybe. The things I have learned the hard way will be learned and put to use by a new Entrepreneur reading this blog. That to me is giving back to my community and it’s honestly my duty.
Thank you for reading and I do hope you return to have questions answered again one day.
