NSS Ambassador Laura Kevghas of Mirus Capital Advisors will be one of the panelists. We hope you can join us.
Wednesday, March 10, 2010
8:00 a.m. – Registration and Breakfast
8:30-10:00 a.m. – Program
Whether you are a buyer or seller, there are opportunities in the current economic climate to maximize your return on a merger, acquisition, or sale of a business. Our panel will review the current M&A market including a discussion of the deals getting done, opportunities for both buyers and sellers, and a review of how to successfully sell or buy a business.
Topics will include:
The Current M&A Market and Trends
The Credit Markets and their Relation to Valuation
Current Business Valuations and the Impact on Estate Planning Opportunities
How to Prepare for and Pursue a Transaction
University of Massachusetts Lowell
MIL Conference Room
Wannalancit Mills
600 Suffolk Street
Lowell, Massachusetts
Directions
RSVP
nutterevents@nutter.com or 617.439.2622
We are pleased to announce the first of four
CEO Seminars | Tues March 23, 2010
7:30am -9:00am, 75 Federal Street, Boston
(offices of Furman Gregory Deptula)
RSVP: Rudi Scheiber-Kurtz at 781-929-9125 or scheiberkurtz@nextstagesolutions.com
The “new” economy brings its own set of challenges to companies who want to grow or plan an exit.
In the first of 4 seminars for CEO’s in 2010, we will begin by focusing the discussion on various ways of balancing the risks in our businesses.
- How can I build out infrastructure and create a model that is both flexible and adaptable, one that can constrict and expand with minimum costs?
- What value can I bring to my business by outsourcing any non-core competency to keep agile and nimble?
- What are the next-step tools and solutions in how I can achieve desired growth in a recharged economy and preserve cash with a conservative budget?
- How do I finance growth in today’s economy?
- What innovative strategies can I adopt to increase value in my business that may not involve raising capital?
Join us for a 90-minute interactive dialogue and take back valuable insights from other fast growth CEO’s. Learn tools, tips and trends to help you navigate in this new economy.
Attendance will be limited to allow more in-depth and interactive discussion. Future seminars will focus on specific topics such as financing, sales and marketing, legal, partnering, and exits.
Why you should attend:
- Network with other CEO’s and gain visibility to best practices in the marketplace today
- Develop new partnering strategies for growing your business
- Learn how to avoid pitfalls of outsourcing key aspects of your business
- Gain critical insights into key legal, financial, and human capital issues in 2010 that will impact your business
Location: 75 Federal Street, 9th Floor, Boston, MA at the offices of Furman Gregory Deptula
Time: 7:30am Continental Breakfast
Program: 7:45am – 9:00am
RSVP: Rudi Scheiber-Kurtz at 781-929-9125 or scheiberkurtz@nextstagesolutions.com
Sponsored by:
Last month the Wall Street Journal published an article For Rent: Chief Financial Officer by Raymond Flandez, commenting in how more and more firms are outsourcing this high level function of management. For businesses small and large, especially companies that want to grow, the finances do get more complex. He points out that many of these ‘Rent a CFOs’ are also Certified Public Accountants.
I agree wholeheartedly with Flandez’ assessment that an outsourced interim or part-time CFO is a capital efficient way to access this expertise and an outsourced CFO can be more objective and give a reality check. I also agree that many of the CFOs are indeed CPAs and this is partially due to the Sarbanes-Oxley Act of 2002 (SOX) that has driven businesses and their CEOs more to the compliance and technical side of finance enforcing the common belief that if you have a controller and an accountant your financial needs are covered. That may apply to life style companies who do not intend to grow but simply run a sustainable business.
From this juncture, however, is where I begin to differ. A company with expansion and growth in their forecast, the paradigm has to shift drastically from technical to strategic. In fact, not recognizing the importance of strategic finance and solely relying on your controller’s risk aversion, you may be holding your company back from that growth. Here is why I think so.
For a fast growing company, the financial spectrum has to be broader and therefore more complex as pointed out by the author of the WSJ article. You want to consider a broad based and strategic CFO, one that picks up where the CPA or controller leaves off. The CFO is your business partner and brings a strategic organizational mind set to the discussion and understands the importance of mapping out the corporate strategy into multiple roadmaps. Given uncertain economic times, this is more important than ever. Finance for emerging businesses brings a complexity that is more than accounting and number crunching.
The CEO needs to fully understand the financial ramification and bottom line each decision triggers. SOX compliancy has driven us too far towards the tactical aspect of finance forgetting the importance of looking forward, checking your Financial Headlights. The CFO plays an important role acting as conduit to growth and walking the fine line between the risk-averse controller and the visionary CEO. Your future CFO needs to have average appetite for risk, not too little and not too much, understand how to translate the corporate strategy and be a true value creator and not a gatekeeper of growth.
Rudi Scheiber-Kurtz, CEO
Next Stage Solutions, Inc.
NSS has joined AIM as a corporate member this week. In an earlier blog I wrote about the BuyMass.org website, the Massachusetts online business-to-business network. AIM created this website along with the Commonwealth of Massachusetts. It is all about creating jobs and bringing economic opportunity to Massachusetts.
We believe that NSS offers a unique value to emerging businesses of the Commonwealth with our CFO on Demand model. Our CFO team is highly experienced not only in the arena of finance, but also in operations and management. Today’s CFO needs to provide more than the governance piece of finance by bringing the organizational mind set to the table. We understand how to grow companies and hope to be of value to the other AIM members.
Rudi Scheiber-Kurtz, CEO
Next Stage Solutions, Inc.
What are your indicator factors as a sign of returning confidence in the economy? I posed this question to a few business colleagues in early summer. Oscar Jazdowski of Silicon Valley Bank (Growth Companies Services) is looking for 2-3 consecutive months of flat unemployment. Currently, unemployment is still going up, making it the highest in 25 years, but the Index of Leading Economic Indicators has shown growth each of the last 4 months. So running a business, what should you be aware of and plan in the near future?
Laura Kevghas of Mirus Capital is beginning to see an uptick in the strategic buyers who have money in the bank and are beginning to consider acquisitions once again. She states that strategics have seemingly had their wallets closed, but are now starting to consider making some acquisitions that fill a strategic hole or which will help grow their market share when business starts to turn around. Ms. Kevghas also points out to be on the alert if one strategic is interested in your business, there may be others as well; so it may be worthwhile to engage an investment banker to run a complete process.
Conservation of cash and strong management of your working capital is still a top priority. Oscar Jazdowski recommends being ready for an upturn by having a pool of contract labor and more permanent hires that you can quickly engage. Now is the time to work out several road maps or scenarios that will give you a competitive edge when the overall economy improves.
With this focus on cash management, you want to make sure you plan multiple scenarios over the next 6-12 months so that you can navigate optimally and be proactive. You want to have these strategies mapped out financially to fully understand the ramifications of your future decisions. I call them your NSS Financial Headlights™.
Strengthen marketing and sales during this economic growth, albeit slow, and keep your business out in the market – visible and ready to respond, suggests Laura Kevghas.
In my opinion, it is also an opportune time to evaluate your exit strategy. Where do you want your company to be in 3-5 years? Consider succession planning and optimize market value and consider this long term plan in your annual budgeting process.
Send us an email or call us at 617-449-7728 to discuss how we may help you build your business and give you a competitive edge with our expertise in strategic finance.
Rudi Scheiber-Kurtz, CEO of Next Stage Solutions, Inc.
Our three new core service offerings help emerging businesses articulate their financial vision:
1. CFO on Demand. In emerging businesses, CFOs are often hired too early or too late; and all too frequently, emerging businesses hire a CFO who is not the right fit. The cost of these mistakes is staggering, both in dollars and efficiency: the average rate of CFO turnover at small and midsized companies is merely 20 months; the cost of screening and hiring two CFOs in a 20 month span can reach as high as $800,000, not including the disruption to the company as it transitions between the two CFOs. NSS confronts this problem by acting as an outsourced CFO on an as-needed basis. This straightforward method creates greater capital efficiency without compromising expertise and eliminates the cost of a CFO search or transition, thereby strengthening the company’s cash flow position.
2. Strategic Finance. Most financial services companies provide their clients with one game plan, strictly focused on the financial picture of the here and now. By contrast, the NSS team equips its clients with multiple game plans; a blueprint for every contingency. Moreover, the NSS plans are focused not only on the immediate fiscal present but also the future, not merely in finance but in operations and management. NSS recognizes that today’s CFO needs to wear many hats and provide the full spectrum of financial guidance to sustainable and growing businesses; governance, compliancy and financial reporting are still important, but they are just one piece of the job.
3. Collective Knowledge. When you hire NSS, you get much more than a pro tempore CFO. NSS offers years of experience – our team possesses complementary skill sets with varied backgrounds, implementing new financial strategies at emerging businesses. Our client-management system is geared toward extensive communication and unparalleled attention to detail. Our team meets regularly to exchange ideas about your company’s challenges. Together, they pass on their collective knowledge to your assigned CFO, who will communicate with you through weekly status reports. As an emerging business ourselves, we understand how difficult it can be to simply keep track of today’s financial headaches, let alone tomorrow’s.
Pendulum swings are a natural occurrence and with the Sarbanes-Oxley Act of 2002 (SOX) small businesses to Fortune 500 companies have been focusing on the compliance side of finance neglecting the other facets of finance, so important for sustainability and growth. I believe today’s financial expert or CFO needs to bring an organizational mind-set to a business, actively participate in value creation and connect the dots between finance, strategy and operation.
Working in the emerging businesses sector, I find this strategic piece missing; in fact, often the CEO is not sure what type of CFO is needed, since for the past ten years compliance based number crunching as been the focus. CFO.com ran an interesting story on how long the list of controller-turned CFOs is getting, yet they tell the story of Archie Black, CEO of SPS Commerce. His number one criteria in hiring a new CFO was to bring someone on board who could help him drive change, number two criteria to understand the vision and articulate it to the investment community and the board, and third for traditional accounting skills.
Reading the CFO.com article piqued my curiosity to find out just how wide-spread the compliance focus really is. I found an excellent in-depth study called the IBM Global CFO Study 2008 that indicates the lack of organizational mindset among CFOs of large corporation and in how SOX has kept everyone focused on the number crunching. This was somewhat surprising to me, assuming that large corporations would have such experts in place.
Small and medium sized businesses struggle even more with getting the full spectrum financial expertise. Often CEOs hire a fulltime CFO too early and if that CFO is not the organizational forward looking kind, tensions will arise as the company grows. Interestingly, the controller or CPA is and should be very detailed oriented; it is unreasonable to expect them to be part of the visionary thinking. Very few people can do both. This also brings up the point of communications to investors and boards, which was the number two criteria of Archie Black mentioned above.
An excellent white paper by the Economist Intelligence Unit seconds the above findings. It talks about the empowered CFO and the evolving focus need on business creation. It points out that today’s CFO needs to lead with an array of skills including general business expertise as well as financial skills. Again, the paper refers to SOX as having been the driver of perfect accounting, leaving the strategic finance piece in the dust.
One of my favorite articles talks about the strategic momentum under threat. This KPMG Study reiterates the importance for the CFO to remain future-focused. They agree that governance cannot be ignored, but always looking in the rear-view mirror is a thing of the past. Today’s CFO must look forward 99% of the time.
This is where I came up with the idea of driving sustainability and growth with financial headlights. I think it gives a nice visual in how we should think about business finance, make sure your taillights work properly and then focus on the headlights. Do you know where you want your company to be in two years? How will you get there?
