Edward Hackert, Assurance Services Partner, Featured on SmartCEO Panel Discussion Concerning Growth Strategies and Mergers
By Vincent Dajani
Planning for a merger or acquisition takes time and due diligence on the parts of both the buyer and seller to ensure a smooth and successful deal. SmartCEO gathered the top experts in M&A advisory as well as experienced buyers and sellers to discuss their thoughts on growth strategies and how to execute a successful merger through careful evaluation and diligent planning.
What growth strategies do you have in place for your business? What are the plusses and minuses of each strategy? When starting a business, what things should the founders think about?
Hackert: I think what happens is that young companies underestimate the importance of the value of strong financial controls. With the absence of them, they have a problem producing reliable financial information. Having them in place from the beginning of the company, to accommodate that growth for the future, is really critical. Often, when we go to work on M&A transactions, we find that there hasn’t been a sufficient readiness assessment for that transaction. All too often, it tends to be a roadblock in M&A transactions and capital raising actions.
Preparing for M&A:
What should CEOs think about before beginning a merger or acquisition? What do they need to be aware of in terms of getting financial statements in order before a transaction?
Hackert: Whenever any company is preparing for any transaction, one key thing a business owner should ask is, how do they communicate what their real value proposition is for the business? Because I can tell you that it’s one thing for a company to be able to sell a product or service, but they may not be able to tell you what the value proposition or solution is that they’re bringing to the marketplace. You can go to Disney and buy a ticket, but what they’re really selling is the experience. I think it’s important to be able to define that to anyone interested in the company.
Hackert: I think a business cannot plan for anything without having a reliable source of financial information. It’s not just a reviewed financial statement, it’s the ability to generate information timely and at fixed intervals, so that someone has the information they need to make informed decisions.