13 Concepts We Can Learn About Small Business and Entrepreneurship on How2Exit's Interview W/ Malcolm Peace: Watch Here
Here is what my team and I learned from this interview: (These are notes from team members, writers, sometimes AI, and even listeners who submitted what i learned loosely edited and shared here) - If it seems a bit unrefined, you're reading our notes, so. yeah. -Ron
Concept 1: Own Small Businesses
Owning a small business can be one of the most rewarding experiences in life. It can provide a sense of fulfillment, pride, and financial independence. For many people, the dream of owning a business is something that they have had since childhood. For Malcolm Peace, the founder of Tsetserra Growth Partners, his journey to owning a small business began with his passion for tennis.
Growing up in Austin, Texas, Malcolm went to James Madison University in Virginia to play tennis. It was there that he met his wife and got an opportunity to work with the University of Virginia men’s tennis program. His dream was to become a head college tennis coach, but he soon realized that the lifestyle wasn’t what he wanted.
Through conversations with some of the donors of the program, he began to see the appeal of owning a small business. These donors owned businesses in Atlanta and Alabama and they had a more balanced lifestyle than the one he was looking at. Malcolm started to ask questions and with the help of the new dean of the business school at the University of Virginia, he began to explore the idea of owning a small business.
The process of owning a small business can be daunting. It requires a lot of research, dedication, and hard work. But for those who are willing to put in the effort, the rewards can be great. As Malcolm found out, the key is to find a mentor or an advisor who can guide you through the process and provide you with the resources you need to succeed.
Owning a small business is a big commitment, but it can also be incredibly rewarding. It can provide you with financial independence, a sense of pride, and the opportunity to build something that is truly yours. With the right resources and guidance, owning a small business can be the start of something amazing.
Concept 2: Invest and Benefit The Local Community
One example of someone taking advantage of this opportunity is Malcolm, a first-generation American who took two years to transition into owning and running a small business. His family moved to the United States in the summer of 1990, and they were entrepreneurs. Malcolm's mom self-taught herself how to do computer programming, and his dad ran an import-export business.
Tsetserra looks for businesses that have been established players in the market for an extended period of time and have a local reputation. This way, they can invest in those businesses and continue to make them develop and grow, thus benefiting the local community. They also take into account the cultural aspect of the business and how it can benefit the community. For example, Malcom's great-grandfather owned one of the largest 70,000-acre cattle and dairy-producing farms on the border of Mozambique and Zimbabwe. This piece of land cultivated a culture of community amongst the locals, as well as a resource that benefited the local community.
Owning a small business can be a great way to invest and benefit the local community. It can provide financial independence, a sense of pride, and the opportunity to build something that is truly yours. While it may seem daunting, with the right resources and guidance, owning a small business can be the start of something amazing.
Concept 3: Preserve And Grow Businesses
One of the biggest challenges that small business owners face is finding a successor to take over the business when they are ready to retire. This is where organizations like “Preserve and Grow Businesses” come in. They are dedicated to helping small business owners find a successor to take over their business and help it continue to thrive.
The process of finding a suitable successor begins with building relationships and networking. This includes reaching out to brokers, investment bankers, wealth advisors, and tax advisors. It also includes direct emails and phone calls to potential successors. The goal is to find someone who understands the value of the business and is willing to take it over.
Once a suitable successor is found, the process of transitioning the business begins. This includes negotiating terms, transferring ownership, and providing training and guidance to the new owner. The goal is to ensure that the business continues to grow and thrive under new ownership.
Concept 4: Find an M&A Specialist Attorney
When it comes to buying and selling a business, it is important to have an experienced and knowledgeable M&A specialist attorney. This type of attorney specializes in the legal aspects of mergers and acquisitions, including due diligence, contracts, and other legal matters. They can provide guidance and assistance throughout the entire process, from the initial offer to the closing of the deal.
The M&A specialist attorney can provide valuable advice on the structure of the deal, the terms of the agreement, and the financial aspects of the transaction. They can also help to ensure that the seller is properly compensated and that the buyer is protected from any potential litigation. In addition, they can advise on the best way to structure the transaction and handle any disputes that may arise.
Unfortunately, many small business owners make the mistake of using their family lawyer or the lawyer who set up their LLC when selling their business. These lawyers may not have the experience or knowledge needed to handle such a complex transaction. This can lead to delays in the process and unnecessary complications. It is important to find an attorney who specializes in M&A transactions and is familiar with the process.
When it comes to selling a business, it is important to find an M&A specialist attorney who understands the complexities of the process. They can provide valuable advice and assistance throughout the entire process and make sure that the deal is completed in a timely and efficient manner. With their help, small business owners can ensure that their business is sold in the best way possible and that they are properly compensated for their hard work and dedication.
Concept 5: Opportunities In Niche Markets
In addition to finding the right M&A specialist attorney, it is also important to look for opportunities in niche markets. Niche markets are often overlooked, but they can be incredibly profitable. One example is the shrimp sorting industry. Sort Right International is a 72-year-old business that manufactures USDA graded devices that sort the sizes of shrimp. These machines are shipped all over the world, from Central South America to the Middle East and even as far as Australia and Papua New Guinea. The machines can process up to 8,000 pounds of shrimp per hour and they are in high demand.
These niche markets may be overlooked, but they can be incredibly profitable. If a small business owner is looking to sell their business, they should consider looking for opportunities in niche markets. With the help of an M&A specialist attorney, they can make sure that their business is sold in the best way possible and that they are properly compensated for their hard work and dedication.
Concept 6: Invest In Relationships
But it's not just about the money. Investing in relationships is just as important, if not more so. This is something that I have seen firsthand. I recently worked with a business owner who wanted to sell his shrimp manufacturing company, brick company, and bridge installation company. He had wanted a family member to come in and take over the business, but none of them were interested.
When I sat down with him, he was excited to know that someone was interested in his business. He was even more excited to know that I was willing to take the time to learn about his business and invest in it. This investment of time and energy was just as valuable to him as the money.
These are just a few examples of how investing in relationships can be beneficial. By taking the time to learn about a business and the people behind it, an M&A specialist can make sure that a business is properly valued and that the owner is properly compensated for their hard work. Furthermore, by investing in relationships, you can create valuable connections that can help you in the future.
At the end of the day, investing in relationships is just as important as investing in business. By taking the time to learn about a business and the people behind it, you can create valuable connections that can help you in the future.
7 Provide Security and Transparency
This is especially true when it comes to providing security and transparency in a business. In today’s world, it’s more important than ever to ensure that employees feel secure in their job and understand the goals and objectives of the company.
Malcolm discussed his experience buying a business and the steps he took to provide security and transparency. He began by asking the seller what their thesis was around the business and what their ultimate goal was. After he purchased the business, he focused on stabilizing it and dealing with personnel issues and customer warranties.
Malcolm then implemented a low-code, no-code software system to monitor and manage performance. However, this was not done immediately. He realized that the employees had been in a state of volatility and uncertainty for some time and he wanted to ensure that they felt secure in their positions. To do this, he held family meals every two weeks and gave them an agenda ahead of time.
Malcolm also focused on providing transparency to the employees. He shared sales information, the runway, hits, losses, and margins to give them a better understanding of the business. He wanted them to feel secure in their jobs and be able to plan for the future.
At the end of the day, providing security and transparency is essential in any business. It’s important to invest in relationships and build trust with your employees. Taking the time to understand their needs and goals will help create a successful and secure environment for everyone.
8 Quality Matters In Competition
Quality is also a key factor in competition. In a global economy, companies must be able to compete with each other in order to stay ahead of the game. This means providing high-quality products and services that meet customer needs and expectations. The example of the shrimp sorting machine is a great illustration of this. Esteban, the international salesperson, highlighted the importance of quality control and customer service when competing with other companies. He noted that the competitors were selling the same product for 15 to 20% less than his company, but the quality of the product was not up to par.
The company realized that in order to stay competitive, they had to shift their focus from price to quality. They began to focus on customer service, quality assurance and price. These three factors are essential in order to remain competitive and successful in the global economy. Quality is the foundation of any business. It’s important to invest in the quality of your products and services in order to ensure customer satisfaction and loyalty.
In today’s global economy, competition is fierce. Companies must be able to provide high-quality products and services that meet customer needs in order to stay competitive. Quality matters in competition and it’s essential to invest in quality control, customer service and price in order to remain successful.
Concept 9: Cross-Sell And Upsell
Cross-sell and upsell are two strategies that companies can use to increase their sales and profits. Cross-sell is the practice of selling additional products or services to a customer who has already purchased something. Upsell is the practice of offering a higher-priced version of the same product or service to a customer.
Cross-sell and upsell are effective strategies for increasing revenue and profits. For example, a restaurant could cross-sell by offering customers a dessert after they’ve ordered their meal. An auto dealership could upsell by offering a customer a higher-priced car with more features. Both strategies are effective because they give customers the opportunity to purchase something that they may not have considered before.
In the manufacturing industry, cross-sell and upsell can be used to increase sales and profits. For example, a company that specializes in buying multiple companies can look for other businesses with similar processes but in different industries. This allows the company to offer a variety of products and services to customers. Additionally, they can offer customers higher-quality products and services that they may not have considered before.
In order to successfully cross-sell and upsell, companies need to have a strong understanding of their customers’ needs and wants. Companies must be able to identify customer needs and create products and services that meet those needs. Additionally, companies must be able to provide high-quality products and services that meet customer expectations. Quality control is essential in the manufacturing industry and companies must have a check sheet and process in place to ensure that products and services meet customer expectations.
Concept 10: Focus On Core Competency.
Focus on core competency is an important strategy for businesses to increase sales and profits. Core competency is the combination of skills, resources, and capabilities that a company has that give it a competitive advantage in the market. It is important for companies to identify their core competency and focus their efforts on it in order to maximize their success.
The first step in focusing on core competency is to identify what it is. Companies should analyze their resources, capabilities, and skills and determine which ones are their strongest and can give them the most competitive advantage. Once a company has identified its core competency, it can then focus its efforts on that area. This can include investing in research and development, marketing, and customer service.
The next step is to ensure that the core competency is being used to its fullest potential. Companies should invest in quality control and customer service in order to ensure that their products and services are of the highest quality. Additionally, companies should focus on providing value to their customers by offering discounts, promotions, and other incentives.
Finally, companies should focus on cross-selling and upselling in order to increase their sales and profits. Cross-selling is the process of offering related products and services to existing customers, while upselling is the process of offering higher-priced items to existing customers. By offering these products and services, companies can increase their sales and profits.
In summary, focusing on core competency is an important strategy for businesses to increase sales and profits. Companies should identify their core competency, invest in quality control and customer service, and focus on cross-selling and upselling in order to maximize their success. By following these steps, companies can increase their sales and profits and remain competitive in the market.
Concept 11: Turnaround Distressed Businesses
Turnaround distressed businesses is a difficult but rewarding endeavor. It requires an understanding of the business, its financials, and the people involved. It also requires a vision for the future and a willingness to take risks.
The first step in turnaround distressed businesses is to identify the core competency of the business. This is the most important factor in determining the success of the business. The core competency should be based on the strengths of the business and the market demand. Once the core competency is identified, the next step is to invest in quality control and customer service. Quality control and customer service are essential for a successful business.
The next step is to focus on cross-selling and upselling. Cross-selling involves selling additional products and services to existing customers and upselling involves convincing existing customers to purchase higher-end products and services. This helps to increase the sales and profits of the business.
Finally, it is important to build a network of contacts. This includes potential investors, suppliers, and customers. Building a network of contacts can help to secure financing and resources for the business. It can also help to build relationships with potential customers and increase the visibility of the business.
Turnaround distressed businesses is a difficult but rewarding endeavor. It requires an understanding of the business, its financials, and the people involved. It also requires a vision for the future and a willingness to take risks. By following the steps outlined above, businesses can increase their sales and profits and remain competitive in the market.
Concept 12: Take Risks To Succeed
Taking risks is an integral part of the process of turning around a distressed business. It is important to understand the risks involved and to be prepared to face them head-on. For example, in the case of a sell-leaseback strategy, the investor must be confident that the business can afford the higher rent and that the investor will be able to collect the lease payments in the event the business fails. Additionally, the investor must be sure that the business has the ability to pay the lease even if the business fails. This requires a thorough understanding of the business, its financials, and the people involved.
Taking risks also involves understanding the market and the competitive landscape. A business must be able to identify opportunities and capitalize on them to succeed. This requires an understanding of the customer base, the competition, and the industry. Additionally, the business must be able to develop strategies that will allow it to remain competitive in the market. It is important to be aware of the risks associated with taking these risks and to be prepared to face them head-on.
Taking risks is an essential part of the process of turning around a distressed business. It is important to understand the risks involved and to be prepared to face them head-on. Additionally, it is important to understand the market and the competitive landscape and to develop strategies that will allow the business to remain competitive in the market. By taking risks and following the steps outlined above, businesses can increase their sales and profits and remain competitive in the market.
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