CASE STUDY: B2B CFOÂ® Partner Provides Financial Transformation, Multiplying Clientâ€™s Company Worth
January 25, 2023EIN Presswire
How a B2B CFOÂ® Partner helped a Business Owner Sell Their Company for $25 Million
My one and only goal is to support my client all the way until their vision is fulï¬�lled.”ARLINGTON, MA, UNITED STATES, January 24, 2023 /EINPresswire.com/ — Bringing strategic business skills and a breadth of ï¬�nancial leadership experience, Randy Walther, B2B CFOÂ® partner, assisted the CEO of a multi-million-dollar security services company contending with cash ï¬‚ow, market growth, and business valuation challenges. He did this by revitalizing the companyâ€™s ï¬�nancial processes, maximizing market strengths, implementing corrective actions, securing funding, and improving EBITDA. This resulted in a tripling of the company’s valuation over a two-year period.
— Randy Walther
In 2019, Walther was introduced to Tim, the CEO of a Boston-based multi-million-dollar facilities and events security provider. The business was in its tenth year and Tim was in the early stages of exploring his exit plan and business sale, but knew he needed to make changes to improve the companyâ€™s valuation. The business was comprised of static security guard services for hotels, condominiums, office buildings, hospital wards, entertainment venues, and even security detail for events such as the Boston Marathon. At that time, the company was hitting $12 million in annual revenue, how-ever, their growth was limited by a restricted cashflow.
Like many businesses, they offered services to different customer segments, but lacked the ï¬�nancial analysis to maximize segment growth potential. In order to successfully manage proï¬�ts and cash ï¬‚ow, the company needed to shift the focus to their most proï¬�table customer base and consequently increase the lifetime value of these customers.
Tim had employed a CPA and an accountant, but he needed a strategic business advisor and B2B CFOÂ® whose ï¬�nancial acumen and experience would not only help equip the company with objective decision-making, but also help improve the companyâ€™s value to provide Tim with a ï¬�nancially sound retirement. Additionally, Tim needed a ï¬�nancial champion to work with his team to provide the ï¬�nancial strategies to help them overcome growth plateaus and expertise in cash ï¬‚ow management, ï¬�nancial reporting, and budgeting/ forecasting as well as the macro components of analyzing the companyâ€™s greatest business segments of opportunities.
Cash ï¬‚ow challenges impeded the companyâ€™s ability to take on new, major clients given they lacked the cash to hire more staff and make the investments needed to broaden the companyâ€™s geographic foot- print. At the time, the company often struggled with making payroll.
Additionally, Timâ€™s ï¬�ve-year goal was to retire with the hopes of selling the business for roughly $4 million to $5 million. But, at that time, the business valuation hovered around $2 million, significantly less than desired.
The Pandemic Strikes
In March of 2020, everything changed. The pandemic crippled a portion of Timâ€™s business literally overnight, where he lost 15% in revenue. Most of the event detail security and a large portion of the static security business dissolved. With deep concerns regarding the other business segments, Walther and Tim had to strategize ways to pivot the organization based on new needs resulting from the pandemic.
After considering multiple scenarios and weighing all options, Walther decided the best course of action was to apply for the Paycheck Protection Program (PPP loans) created to provide loans to help businesses make payroll and cover other expenses during the pandemic. Timâ€™s company qualiï¬�ed for $2.1 million in PPP funding which they later learned was forgiven and the key to the companyâ€™s ï¬�nancial transformation. Helping with scenario-based modeling, Walther knew the PPP loan could provide a runway for the company to strategically reinvest money back into the business.
Learn More: Read the full case study and see how Randy helped this CEO through the pandemic and helped him sell his business for $25 Million.
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