Are you executing the right strategies to market your products and services? Are you planning to buy or sell a business? In this episode, guest Cameron Kolb, senior broker at Raincatcher, speaks with host Bob Roark on how business owners spend their money, time, and effort in growing their businesses. Cameron explains his company's professional process so you can start analyzing yours. He helps and guides people to get the maximum value when buying or selling their businesses. He values being true and honest to the people who are asking for their help while getting the job done. Stay tuned to know more to scale your business up!

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The Essentials Of Buying And Selling A Business With Cameron Kolb

The big questions are how do business owners like us spending our own money, time and effort? How do we grow our businesses and jump the line that lets us accelerate the delivery of our products services in our community while being smart about our growth profits culture and still create a lasting value in our business? Those are the questions in this show. We'll share some of those answers. Our guest is Cameron Kolb. He's a Senior Broker with Raincatcher. Welcome to the show.

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Our guest is Cameron Kolb. He's the Senior Broker at Raincatcher. Cameron, welcome to the show. Thanks for taking the time. Tell us a little bit about your background and bring us up on where you are now.

I started my professional career at Northwestern Mutual doing financial planning. We initially started with insurance and worked in the niche of business owners because we thought that was a good need there. As we expanded the team investments or more licenses they got, I started to specialize in exit planning. I worked with a lot of physicians and business owners. I did that for about six years and then, the debt in the family caused me to have to rethink things then, ultimately decided that based on what I've experienced with all these business owners and how difficult of a time they've had trying to sell their business, I thought there might be some opportunity to help essentially do business brokerage.

My path after that was that I went out on my own, learned how to do business brokering, did it on my own for about five years and then was asked to join Raincatcher back in May 2021, which has just been great. I essentially went from being a solo practitioner to doing everything that there is to do with now. Now, I get to focus on what I'm great at, which is bringing buyers and sellers to the table and getting deals done.

I think about the compare and contrast between the team approach to a business sale versus the sole practitioner approach to bring it to a sale. What it reminds me of is the difference between having a job and a business. For the sole practitioner, they might've been expertise that you didn't have, it might be franchising or one type of specialist event, whereas at RainCatcher, you have a depth of field.

[bctt tweet="Continue learning. When you start working with people, you will realize that there’s a lot you don’t know yet." username=""]

I thought I was smart then I started working with some smart people and realized there's a lot that I didn't even know I didn't know. It'll bring 4 or 5 months together on a deal we're working in. It's just made a huge difference in the execution and the progress that I've made as a business professional. I feel that one of the lots about what you can do to add a lot more value than I’m previously doing. There are different ways to sell businesses as a business broker. I thought I'd been doing it the best way and then sure enough, I learned that there are better ways to do it, which is humbling.

It’s interesting to maybe expand on that a little bit. You think about, “I thought I knew this way to sell a business and then I matured or adjusted.” What was it that you used to think? What do you think now?

In my mind, before joining Raincatcher, I assumed that the deal was done in the conversations between the buyers and sellers. My goal was to get people through the process, get them an NDA, get them qualified to the point where I felt comfortable sharing only information. I would keep the information relatively simple and high level with the idea of coming in or out and then get them on a conversation with the actual sellers. That's where I felt like most value was created. I didn't spend as much time on that initial document presentation. Ultimately, my goal was to find the best buyer at the moment. What we've been able to do or essentially what we look different now is we spend a lot more time on the material itself.

The confidential information memorandum, that's a lot higher quality than the information I'm putting out there before. Also, one of the other key things is that we focus on the buyer process and keep as many buyers active in the same stage of the process at the same time. That way, when we're ready to call the offers, we've got a handful of buyers who are still interested. By doing that, you're able to drive the price up to essentially what the market will allow as opposed to what maybe 1 or 2 off buyers might've been on using my previous methods. It was still got deals dotted and the sellers were still happy with them but there's potentially a little bit of money left on the table just by having a better process that would do now.

Some folks may or may not know the folks that have sold a business before, probably the ones that haven't may not. Is that a confidential information memorandum?

Correct. Essentially, what Raincatcher has been able to do is we've taken the approach that a lot of the investment banks at a high level make boutique M&A firms do with selling a business. It's more mainstream, main street, small business but the businesses are doing somewhere between $1 million to $20 million of revenue. We brought that professional process down to that size business because it felt like there was this gap that was being served by those industries.

Mainly because it makes perfect sense as a business owner, if you can make a lot more money on a bigger deal but putting in a similar amount of work, you're usually going to take the bigger deals. Having the servant heart that was always wanting to help business owners and coming from a family of business owners myself, I've got this passion and this place in my heart for the backbone of America. It's those businesses that employ way more people than the bigger businesses.

There were some stats after the market events in 2008 that said 72% of all new jobs developed in this country after 2008 came from small businesses. A lot of people know that. In smaller communities and even in the bigger communities, you look around at the business owners and the employment is not the Lockheeds and Boeings in every town necessarily. I didn't come from a business family background.

My father was a military and I was military. He started getting involved in the business community and my admiration for those folks that are self-starters and overcame many different challenges is like you. I'm a fan and I like watching what they do. In circling back a bit to what you said at the beginning, you were working with physicians' practices and so on in your previous life. What's your perspective on the physician professional trying to sell their practice having been through small business and exit planning now? What are their challenges?

It's a unique landscape for physicians. It seems like all the big entities are essentially gobbling up all these smaller practices. To sell a physician's practice is difficult because you have to find someone who's in that same specialty and is at the perfect place in their career where they can come in and buy your practice. They've got capital, credit, the financing they need but also they've got the knowledge to run a practice within whatever specialty it is. That's what's led to a lot of those physicians having to sell to the bigger conglomerates and essentially becoming a part of UnitedHealth. Ultimately, that's what's probably caused that.

[caption id="attachment_5951" align="aligncenter" width="600"] Buy A Business: If you can make a lot more money on a bigger deal but put in a similar amount of work, you're usually going to take the bigger deals.[/caption]

 

Whenever I have conversations with sellers, I always try to do a preliminary search of how many practices like theirs are out there being sold. There are actually quite a few, which tells me that there's not a lot of movement especially when you look at those businesses that have been listed. One of the big challenges is finding their successor if that's going to be something they do. If not, figure out the exit plan that's going to work for their long-term goals. A physician's practice is probably one of the hardest to sell because so much is dependent on that one person, which is the physician or the group of physicians.

When you look at the small non-physician business marketplace, do you see similar problems in determining the difference between a job and a business that these folks have?

It's more prevalent in physician practices. It's the private physician practices. When you look at the small busin