Monthly Archives: November 2014

The Secret to Growing a $1 million company by 5X

Posted on November 30, 2014 by John F. Dini

In my work with hundreds of small business owners, I’ve noticed that there are two “danger zones” where an owner may, consciously or unconsciously, prevent his or her company from growing any further. The first zone lies at about $1 … Continue reading →

Posted in Entrepreneurship, Leadership, Management | Tagged , , , , , , , , , , | 3 Comments

3 Responses to The Secret to Growing a $1 million company by 5X

  1. Larry Amon says:
    December 1, 2014 at 2:17 pm

    John, Very true. Setting and achieving growth goals as part of every day business is what it takes to grow from a $1 Million a year company to one 5 times larger. This was a practice that we used to grow my company from $100K to $5 Million in less than 5 years and be on the INC 500 list as one of the fastest growing privately held companies in the U.S.
    Larry Amon

    Reply
  2. John H. says:
    December 8, 2014 at 7:56 am

    Although occasionally I have run into a business owner with a personal bias with regard to anything perceived as “corporate”. So implementing processes, or giving up tight control, is avoided. But for many SMB’s the observations shared in your post should are exactly what is needed.

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How Can You Sell a Business to a Buyer Who’s Broke?

Posted on November 23, 2014 by John F. Dini

According to a recent report from the Federal  Reserve Bank, over half (52%) of Americans could not pay for a $400 car repair without borrowing. We can assume that most of these folks would not be legitimate prospects to purchase … Continue reading →

Posted in Exit Planning, Thoughts and Opinions | Tagged , , , , , , , , , | 3 Comments

3 Responses to How Can You Sell a Business to a Buyer Who’s Broke?

  1. Neil Arthur says:
    November 24, 2014 at 7:41 am

    can you identify the source of the chart stats? thanks, N

    Reply
  2. Ted Leverette says:
    January 12, 2015 at 10:26 am

    What John Dini writes is so true. Seller financing sells businesses. Savvy buyers expect the seller to have some skin in the game post-acquisition.

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Smart Metrics and Dumb Metrics

Posted on November 16, 2014 by John F. Dini

“We doubled our profit over this month last year!” When I visit a coaching client, that’s a pretty exciting opener. Of course I want to know how and why. Too often the answer is “Well, last year this month had three … Continue reading →

Posted in Uncategorized | 1 Comment

One Response to Smart Metrics and Dumb Metrics

  1. Steven Bankler says:
    November 16, 2014 at 9:57 am

    >>A twelve month cycle is required by the IRS, but that doesn’t mean you need to run your business by it.<<

    While technically correct, IRS does allow 52/53 week years, which includes 13 – 4 week months!

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The Luxury of No Resources

Posted on November 9, 2014 by John F. Dini

Among the Baby Boomer business owners who are beginning to plan their retirement, there are millions who founded the companies they plan to sell. Many of these were technicians when they started. They began as employees, and then used their … Continue reading →

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Key Man Policies May Not Cover a Buy/Sell Agreement

Posted on November 2, 2014 by John F. Dini

Over the last few weeks, I’ve had a number of conversations with clients about key man insurance. Let me say at the outset that I don’t sell insurance, and have no financial stake in whether any client has coverage or … Continue reading →

Posted in Entrepreneurship, Exit Options, Exit Planning | Tagged , , , , , , , , , | 7 Comments

7 Responses to Key Man Policies May Not Cover a Buy/Sell Agreement

  1. Frank Benzoni P.E. Retired says:
    November 2, 2014 at 8:56 am

    John

    Another “Wide Awake Article” – To be advised is to be prepares, and you continually do that.

    Always look forward to the next !!!

    Thank you

    Frank

    Reply
  2. Brad Elmhorst says:
    November 3, 2014 at 8:39 am

    John,

    Agreement that key-man insurance policies should be separate from buy/sell – ownership agreements. Having lived through the unexpected loss of two employees, I would encourage small businesses to look beyond ownership when considering key man insurance as part of their disaster planning process.

    Brad

    Reply
  3. Mike says:
    November 3, 2014 at 10:49 am

    Another type insurance to consider is whole life purchased using Section 79 Insurance.
    Allows the company to pay for the insurance ( deduction to the company) owner pays tax on only part of cost, however beneficiary is the stock holders estate ( or wife) .
    Company pays for policy , stockholder owns and benefits from it directly.
    Can tied funding this to some part of stock valve in the future.

    Reply
  4. RICH FREELAND CBC says:
    November 3, 2014 at 8:17 pm

    John- My 43 years in the life business has taken me into many areas of practice. The usual KEY MAN POLICY is usually designed for one purpose only.It is to cover the loss of a “Key Man” such as a top salesman that brings in more than 50% of the companies business or an engineer or project manager that a company could not operate or complete a job if they should die. Buy and Sell agreements are usually to cover owners , partnerships or corporations for death or long term disabilities to owners or stock share holders to keep the business from imploding or having to deal with non producing spouses or minor corporate owners.All these plans should be drawn up by a law firm that is experienced in Business Law! not Legal zoom! The last thing is making sure that the agreements are funded with the proper products to meet the contracts specifications in the B&S agreement. I would shy away from Sec 79 plans in funding these agreements and look at the latest IRS rulings on SEC 79 use in business insurance? Comments Welcome! RICH FREELAND CBC

    Reply
    • John F. Dini says:
      November 4, 2014 at 5:25 am

      Thanks Richard. I agree that key man policies should be used for critical employees as well. I know dozens of companies, however, where key man covers the owner, who does not function in a sales or client management role, and the owners’ belief is that the benefit will be used to purchase stock from their families. As to the applicable IRS codes, you illustrate my point that such instruments must be carefully constructed by a professional such as you.

      Reply
  5. Todd Marquardt says:
    October 7, 2017 at 8:21 am

    A key man insurance policy is different from a buy sell insurance policy. You hit the nail on the head. The purposes are different.

    Reply
  6. Thomas says:
    August 14, 2018 at 8:00 am

    The trick is to get the business owner to planning table. In my 34 years of selling life insurance and disability insurance there is a significant resistance by small business owners to approach the topic. The vast majority of small business owners do not have these plans in place. It is even more critical for family businesses. I completed a large plan for a family business in 2004, the business was started in 1946. Good luck to all the life insurance purveyors out there. It’s a mine field.

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