Closely-Held Businesses Case Studies
Helping a start-up sell
AGH played a pivotal role in an IT staffing company’s quest to realize the sale price it desired. How did we do it? We helped the company grow from its start-up phase and kept the channels of communication open through the sale. With a focus toward the owners’ goal of growing the business and then moving on to another venture, we advised in creating an exit strategy early in the process. AGH worked closely with the owners to maximize—and in some cases reengineer—company systems and processes to obtain the highest possible sale price. As a result, the company earned higher margins and a better bottom line. We also guided the company through important decisions by acting as its in-house CFO. When the company was well-polished, we worked alongside venture capitalists and investors to achieve our clients exit goal. The bottom line: The founders sold the business for more than $60 million in a few short years.
Drilling deep for a better business foundation
An entrepreneurial couple founded a company that blasts through rock at building sites and soon afterward asked AGH for advice. With little start-up capital, the husband and wife team relied on investors to take out lines of credit on their behalf. In exchange for this risk, the investors received majority ownership of the company. AGH was able to connect the founders to a banker who obtained an SBA loan and a business line of credit for them. The new funding paid off most of the start-up debt and returned the majority ownership to the entrepreneurs. After only a few short years with AGH helping to navigate the journey, the founders now own 100 percent of their company.
A sweeter deal
Who doesn't love cheesecake? One of our clients makes some of the most coveted cheesecakes in the nation, and came to us with a common concern: “My products are selling well, but where is all the money going?” We spent time with him creating financial reports, learning his operations and analyzing his profit margins, which were less healthy than his products. Together, we managed to fatten his profits and plan for the day he would sell his business. He bought a building where he makes his delicacies, and we established the building as a separate entity. Now, when he is ready to sell the cake business, he can maintain an income from the real estate. Along the way, this client even taught us a thing or two – including that the best way to cut cheesecake is with dental floss!
Sharing… and protecting the wealth
A developer in Tennessee wanted to make an employee a part-owner of one his buildings. However, his business was structured in a way that the employee would have become a part-owner of the entire company. AGH helped the developer change his company structure to achieve his goal. We established the new building as a separate operating entity, so the employee became a partner of the building, but did not have a stake in other properties.