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Clarity

David C Barnett

Moncton, New Brunswick, Canada

I’m happy to help callers from all around the world.
David C Barnett, BBA, CMEA, BFC
Business Valuation Specialist
Business Transaction Specialist
Business Finance Consultant
Certified Machinery & Equipment Appraiser

Hundreds of YouTube videos on my subject matter here: http://www.youtube.com/c/DavidBarnettMoncton

My iTunes podcast is here: https://itunes.apple.com/ca/podcast/david-c-barnett-small-business-deal-making/id1234025671?mt=2

www.DavidCBarnett.com
www.BusinessBuyerAdvantage.com
www.HowToSellMyOwnBusiness.com
www.BusinessAndAssetValues.com

Started 5 different companies since 'adulthood.' Sold 2, Closed 2, One still going...
Started a finance consulting practice in 2006
Began brokering the sale of companies in 2008
Bought a Sunbelt business brokers office in 2009, sold in 2011

Brokered the sale of over 35 businesses in 36 months, arranged financing for hundreds of start-ups, acquisitions or expansions.
Helped hundreds of clients through the purchase or sale of a business, more importantly, helped countless people to NOT make a really big mistake.
Has owned up to 5 income properties at a time.

Author of three best-selling business books; 'Invest Local: a guide to superior investment returns in your own community,' 'Franchise Warnings: What you really need to know before you buy' and 'How To Sell My Own Business: A guide to selling your own business without paying a broker's commission.' all available as well as 5 other books on Amazon or from www.DavidCBarnett.com

$6.67/min

387

387 Calls

210

210 Reviews

32 minutes
Avg. call

Small Business Business planning Valuation Business Analysis Deal Making Business Valuation Mergers Partnerships Franchise Consulting Cash Flow Forecasting

Call me to talk about

Business Financing, Planning, Forecasting

I have arranged financing for hundreds of businesses since 2006. I can advise on balance sheet requirements, cash flow forecasting, business plans and capital structures for startups and company transactions.

Franchises and Franchise Systems

I've helped buy and sell numerous franchises and even wrote the 2015 Best-Selling Book Franchise Warnings. I can help you look at a franchise opportunity or advise you on setting up your own franchise system. My book is available on Amazon or from www.FranchiseWarnings.com I have consulted with several franchise systems on sales and growth.

Buy a Business, Sell a Business, Valuation

Have conducted the purchase and sale of dozens of businesses since 2009 and consult with buyers and sellers about transactions they are contemplating. I also help sellers prepare documents and confidentially promote their business.

Private Lending, Leasing, Local Investing

I have experience in private lending for leases, loans, inventory finance and secured and unsecured lending.

Partnership Issues

Sometimes we get into business without properly setting up our structure. Sometimes we make assumptions about what our partner should be doing and get upset when it doesn't happen. Sometimes we get angry and want to end our partnership. I've been helping people on Clarity for years discuss, understand and figure out ways to make better partnerships and end the ones that need to die.

Answers 91
Reviews 210

Answers

David C Barnett answered

What are the general profit sharing rules that resonate well for long term relationship?

Hi, I've helped people buy and sell businesses for years and have helped people dissolve and create partnerships and raise capital.

When you take on a partner, you're selling a piece of a business. Either the one you have now or the one you hope to grow into.

The question is, 'what do you expect your new partner to bring to the business and what will they need to get in order to justify the risks?'

People use the word 'partner' to talk about real partners, shareholders, investors, etc. You can structure debt arrangements, equity arrangements or combinations depending on what you want to achieve and based on what inticements you think you need to offer.

Give me a call to discuss the specifics of your situation and be sure to check out my reviews to see how I've helped other people with partner issues.

Thanks

Dave

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Strategic Partnerships

Partnerships

Partnership Development

David C Barnett answered

Are there any companies that do pre revenue valuations? Besides equity firms and VC's?

Hi, I've been helping people sell businesses since 2009 and recently wrote the best-selling book 'How to Sell My Own Business.'- Available on Amazon or at www.HowToSellMyOwnBusiness.com

There are many firms and professionals who could do a valuation on a pre-revenue business. You would need forecasts showing what the likely sales, costs and revenues would be in the future.

Getting a potential buyer to agree with the assumptions and pay you for sales and a cash flow that doesn't exist is another matter.

Typically business buyers are looking to acquire cash flow or buy something that will make their own company perform better.

So if your startup has a spectacular new technology that will help company X to save costs or make more sales of their own, then they'll see value in buying you.

The trouble is identifying these synergistic buyers and getting them to pay you for advantages that they will have to achieve post-acquisition.

If you'd like to chat, arrange a call.

Thanks

David C Barnett

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Valuation

Business Valuation

David C Barnett answered

I'm getting a few IT people who are asking for free advice about how to sell their services. They hate selling! How can I politely say: "enough"?

This is an easy question to answer. Stop meeting people for coffee and instead send them to your Clarity.fm link.

I give lots of free advice on my YouTube channel, I don't need to spend time re-telling general advice and ideas that they can learn on their own time. http://www.youtube.com/c/DavidBarnettMoncton

This does several things:
1. Eliminates people who aren't serious
2. Gets you paid for your time
3. Eliminates the 'time suck' of travelling to and from cafes
4. Actually gets people to listen and value your advice.

I've been doing this for years and it works great. I always preface things by saying that if the conversation leads to project work for me, I'll credit back their cost of the Clarity call on my eventual invoice to them.

Arrange a call if you'd like to discuss further strategies. I've been working as a consultant for years.

David Barnett

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Sales

Information Technology

Managed Services

David C Barnett answered

Does it make sense to accept equity plus a contract specifying payment for services when the company is profitable?

Would you hand over 100% of your paycheck to your investment advisor?

In this scenario, you're being asked to invest your time instead of money but really, it's the same question.

I've done several of these types of 'time investments.' Most have not worked out, one might.

I'm not too worried though because most of my time that was invested was 'extra time.' I basically traded some of my leisure for an opportunity to be part of something that might hit pay dirt.

These deals can be fun, but I don't think it makes sense for most people to work full time on them. It would be like putting 100% of your paycheck into your retirement account and finding money for groceries elsewhere but with a lot lower chance of paying out one day.

Dave

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Start-ups

Healthcare Information Technology

Deferred Compensation

David C Barnett answered

What do you understand by the term "deal crafting"?

"Deal Crafting" accurately describes what I did for years as a business broker. Most business owners are expert at delivering their product or service, but most know very little about the purchase or sale of a business. This leaves two inexperienced and somewhat ignorant parties trying to fumble around and make a deal.

As a professional broker, I would add value by first assessing a realistic selling scenario for the business and then setting realistic expectations in the seller's mind. Once a buyer was found, I would work to educate the buyer on the process of buying a business and show them examples of how deals can be structured. By communicating with both parties and understanding their goals in the negotiation, I often made suggestions which lead to an ultimate successful deal.

I would imagine that this scenario can play out in many areas of business where you have infrequent transactions or inexperienced participants. For example, specialized purchasing consultants exist to help companies acquire machines and equipment that they may not regularly purchase.

Could you not say that a designer or decorator is helping to 'craft' the chef's new restaurant? There certainly are people out there who specialize in coaching or shepherding a negotiation. To the point of the earlier respondents, I ran into a large number of charlatans and con artists who claimed to be able to do what I did but could not.

I would recommend that you ask for references from both sides of past deals and follow them up if you ever go looking for this type of expertise.

Hope this helps.

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Deal Making

Deal Structuring

David C Barnett answered

How can I successfully make a career change to B2B account management?

I've been selling to businesses my entire career. Getting into B2B sales is easy.

Find a company that you like who sells to small business and find out who the sales leader is.

Connect with them and ask for an appointment. Explain your desire to get into B2B sales.

Explain that you'd like the opportunity to learn and demonstrate your value.

Then let them know that you'd like to join their team and you'd be happy to work on a commission-only basis.

If you can cut it in commission sales, you'll have a world of opportunity available to you.

Good luck. Arrange a call if you'd like to discuss your specific details.

Dave

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Job Search Strategies

David C Barnett answered

What questions should I ask before agreeing to be a partner in an e-commerce retail business?

I've guided many people through partnership issues.

You're essentially talking about buying half of this business in exchange for your labour.

Here's what you need to do.
1. Put a value on the business
2. Put a value on your time
3. Make a share purchase agreement with the partner.. I get 50% of this business in exchange for XX number of hours of my services.

Otherwise you're looking at a time black hole with no limits. As well, you want to be sure you become an owner so that if things don't work out, you still get a seat at the table in deciding what happens next.

Check out this video, it talks about some of the issues you're facing: https://youtu.be/UNZavOxgg74

If you need help sorting out the mechanics of setting this up, arrange a call with me.

David Barnett

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Retail

Online Retail

eCommerce

David C Barnett answered

Can anyone tell me where I would find accurate information on the earnings multiple number to use for my business?

Further to David C. Baker's answer, there are databases of business sales with reference to selling price as a percentage of sale and as a multiple of EBITDA and Seller's Discretionary Earnings. (SDE=EBITDA+an owner/manager salary)

With small companies that generate a profit under $500K of EBITDA, it is critical to properly normalize the cash flow, the company can then be compared to other similar companies that have been sold.

I have dealt with several companies in the IT/SaaS space and what I've learned is that they aren't in touch with the reality of selling small business cash flows. Typically a service company with little in capital assets is going to sell for between 1.5 and 2.8 times discretionary cash flow.

What most IT entrepreneurs are looking for is the lofty acquisition multiples that make the headlines. The reality of selling a small business is that a buyer needs to be able to make a living, get a return on his investment and service his debt based on the cash flow that already exists.

Put yourself in the potential buyer's shoes and see what you could afford to pay and still achieve those requirements.

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Business Valuation

David C Barnett answered

How do I legally sell my email list asset, and do I need to sell the business along with it?

If you sell the whole business, then the email list or 'prospect list' naturally comes with this purchase.

The challenge in selling just the list is that you actually sell the list such that you're not really just selling a copy.

For example, if you sell a copy, then you may fall afoul of spam laws because those people didn't give permission for their names to go to another user in addition to you.

What you may wish to do to make it easier is to sell the list along with your account access to the mail provider, ie your Mailchimp access or whomever you use.

This way you are truly selling a business asset and not just selling someone a 'copy' of your list.

Hope that helps.

For over 250 videos and blog posts about buying and selling businesses visit www.DavidCBarnett.com or arrange a call to discuss your specific case.

Dave

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Email Strategy

Selling Ideas

Legal Assistance

David C Barnett answered

What is the best way to get started on Clarity if I already have an existing audience elsewhere?

I've been in your shoes.

Here's how Clarity has helped me:
1. I meet new people on Clarity who call me, sometimes more than once, then migrate over to my other programs or buy online courses or products.
2. I promote my Clarity page to my existing tribe. What I find is that some people like to talk to me and make sure I'm 'real' before investing in courses or programs that they've been considering.
3. Sometimes when people want a 'quick talk' I send them to my Clarity profile simply to have Clarity take care of the billing, payment and scheduling.
4. Whenever someone asks if I can join them by phone or skype to 'pick my brain,' I respond with my Clarity page link. This derails the free-consulting seekers.

Hope this helps.

Check out www.InvestLocalBook.com and see how I use Clarity on both my main page and on the 'I Need David's Help' tab.

If you want to chat further, just book a call.

Dave

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Clarity

Coaching

New Business Development

David C Barnett answered

How should I make a proposition for a promissory note?

Hi,
You show him the opportunity.
You show him how much you need and how you will spend it.
You show him how he will be able to see what's going on and watch his investment.
You then let him make you an offer.

If you'd like to discuss this particular case, please request a call.

Thanks

Dave

For hundreds of videos on buying, selling, financing and managing small and medium sized businesses, visit my blog at www.DavidCBarnett.com

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Funding

Reviews

David is incredibly supportive and professional. I intend to work with David and his team long term. I have never come across such a knowledgeable, friendly and trust worthy partner! Thank You!

William J Becker III Source: Clarity

David was exceptionally helpful when brainstorming a potential acquisition. This call was a great combination of "have you thought of", validating my own ideas, and David bringing his own ideas to the table. Thanks David!

Jon Baker Source: Clarity

great insight, super helpful!

Brianne Hellman Source: Clarity

David was professional, knowledgeable and concise. Will use again and would highly recommend for any business acquisition questions.

Nick Fuglaar Source: Clarity

David is concise and gets straight to the point, being a good steward of your time.
He is an ally when evaluating business acquisitions. Not shying away from difficult questions and willing to challenge you where needed. Thanks for the help David!

Alex Sheridan Source: Clarity

David was exactly what I needed. I had been digging for advice, talking to many people and was just heading in the wrong direction. David was able to ground the conversation, and focus the goals leading to a clear path forward! Thank you and I look forward to chatting again!

Jase Zwarich Source: Clarity

Absolutely knowledgable and straight to the point

Manasse Shingiro Source: Clarity

Fantastic call with David! If you are considering booking time, do it! His direct no-nonsense style and extensive business knowledge made for a very productive conversation. Within the first 10 minutes the call had exceeded my expectations for what I hoped to discuss.

Aaron Burnell Source: Clarity

David was clear and concise and all answers. He really knows his stuff!!!

kirk hinckley Source: Clarity

David's guidance has been extremely valuable. Would recommend him to anyone looking for business buying advice!

Matt Smith Source: Clarity

David is exceptional and his time is the best value around. He's literally saved me hundreds of thousands of dollars by encouraging me to change my mental model around deal structure and value. I encourage anyone who is considering a business purchase to run it by David first - he'll likely save you money and give you more confidence in the deal.

Clint Peck Source: Clarity

Member since January 2012