Financially, what does this mean? We that remains to be tallied, but ESPN has already said the Rams value has gone from $1.45 billion to about $2.9 billion since the move. Yup, doubled.

The Los Angeles Times has published estimates that with the completion of the $2.6 billion stadium to be shared between the Rams and Chargers, a team like the Rams could bring in $330 million a year.

Of course that could go up or down, depending on lots of other factors, but if this past season is any indication, Los Angeles just might choose to rally round their long lost Ram team with a lot of dollars going into the team coffers! •

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Fatherhood has a way of forcing us to reexamine our views in a way that is always not so easy.

I always felt that, as a father, part of my role was to try to put my son’s newfound experiences into perspective. He had just graduated college and was starting a new job. He was on his way to a successful career, and we had frequent discussions about success and what that meant. I wanted to give him the benefit of my hard-earned wisdom, so I decided to spend some time determining my own definition of success.

I wanted a simpler way to measure success that I could pass along to my son. Otherwise, how would he know what success looked like? How would he know if he had achieved it? How would he know when it was okay to step off the treadmill?

How do any of us know?

This is what I came up with: “Success is the ability to do whatever you want to do, whenever you want to do it, with people who are meaningful to you.”

I was struck by how this definition gave each of us wide latitude for tailoring it to our own lives. It did not prescribe any specific elements or prerequisites. It did not even address the acquisition of wealth or power, only what we chose to do with it, and whom, if anyone, we chose to do it with. Most importantly, it addressed the ability to reclaim and use time—truly our most limited resource.

I tried this definition out with one of my clients, a woman whose company had grown exponentially in the last few years. “You missed one of the most important parts of success,” she scolded me. “I have the ability to do whatever I want, whenever I want. I just don’t have the freedom to do it. I’m way too busy growing my company.”

I revised my definition: “Success is the ability and the freedom to do whatever you want to do, whenever you want to do it, with people who are meaningful to you.”

Clearly, success is not about stopping the activities that have given you financial freedom. It is about stopping the activities that prevent you from enjoying that financial freedom.

Some people never retire — not because they want more money, but because they truly love their jobs. They love waking up in the morning and doing their work. Albert Schweitzer, winner of the Nobel Peace Prize, said, “Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you will be successful.”

I remember my experience as the head of children’s entertainment at A&M Records. I was traveling all over the country, staying at the best hotels, eating at the finest restaurants, going to the greatest concerts and surrounded on a daily basis by interesting, forward-thinking creative people. I really loved my job. I woke on Monday with the same enthusiasm with which I woke on Saturday.

One day, I was speaking with one of my colleagues at the record company after a pretty amazing concert the night before. We both just couldn’t believe we were 27 years old and were living a life that as teenagers we could only dream about. “I would do this job for free,” my colleague exclaimed.

We didn’t know it, but we were already successful. We already did what we loved all the time with people we enjoyed. At a young age, we had achieved what so many never do.

There was a great column by Panos Mourdoukoutas in Forbes Magazine that, interestingly, appeared on a New Year’s Day, that time of year when so many people are making resolutions. It explained his view of the correlation between success and being happy. He asked the reader to consider two simple questions: “What am I doing today?” and “Why am I doing it?”

“If you are happy with the answers you came up with to both questions, get out of bed and enjoy the day,” he wrote. “If you are struggling to find the right answers, close your eyes and go back over the items on your to-do list.”

Imagine if you didn’t like the answers. Perhaps the top of your list might be filled with admirable goals and tasks—but they’re not right for you. They are right for somebody else who has been setting your agenda, or perhaps for the someone you think you should become. The goals that are important, the ones that will move you toward the happiest life, may have been systematically pushed down to the bottom of your list, minimized over time or even forgotten. That’s how you can wake up and wonder why if you have so much money and “success,” you are still unhappy.

People still think of success as the precursor to happiness, but the ladder of success leads, rung by rung, merely to more success. You might get the promotion or the bigger paycheck, and you are still nowhere even near the ladder to happiness.

It’s a terrible wake-up call, the kind Peggy Lee sang about. “Is That All There Is?” is a profound expression of disillusionment. The lyrics tell of a life’s major milestones, followed by that question — Is that all there is? After so much achievement, why does it all feel so empty?

The endless pursuit of success is understandable if you’re still hustling to pay your rent. There is a minimum level of financial security that people absolutely must have for shelter and food. Once those basic needs are met, though, there is time and energy for focusing on other types of goals, such as being happy.

Are your basic needs met? If so, it is time to take a hard look at how much time you need to spend following the money, and how much time you would like to spend following your passions.
Draw a vertical line down a piece of paper. On the left side, list your successes and accomplishments. On the right, make note of the specific moments of happiness each of these accomplishments afforded you. Were they worth it?

On a second sheet of paper, write down all of the experiences you wanted to have—alone or with others—that you couldn’t because you were busy pursuing success. Was the success worth it?
How do you know when you have achieved success: When you have given yourself the ability and freedom to do whatever you want to do, whenever you want to do it, with people who are meaningful to you.

To be clear, I am not opposed to making money. The problem with the endless pursuit of success is not the success or the money; it’s the endless pursuit of it—usually to the exclusion or minimization of the moments that make us happy.

Take the time now to reorient your energy toward enjoying happiness on your journey. It doesn’t mean you have to quit your job or give away your fortune. On the contrary, it means that the pursuit of success should afford you the ability to enjoy all of those moments of happiness.

Now. While you can. •

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Some like it. Some hate it. It can be lux and wonderful, or fast and furious. But we all do it—business travel!

Each year, more than 40 million visitors come to the greater Los Angeles area. San Diego gets more than 10 million overnighters. And while the vast majority of visitors are tourists, Southern California is one of those areas that enjoys a tremendous amount of business travel as well. San Diego is one a destination that gets “combo” travelers, business travelers who bring the family to enjoy the city (or conversely tourists who book a day or two of business while they are here).

Vacation travel is about getting to a city, seeing and experiencing things in that city, and enjoying your trip. Business travel is a bit different, though, then vacation travel. Business travel has more to do with location, convenience, and ease of work. We all love lux business travel, but it’s not always possible. Business travelers are often restricted by time, location, or budget.

In Southern California, location is arguably the first decision. If you fly into John Wayne in Orange County and have to make it in 90 minutes to the San Fernando Valley, you’ll be hating life as you sit on the infamous 405 freeway. And while LAX and Anaheim may not be your cup of tea for hotels, sometimes a flight or convention dictates there is no better area to stay.

When we reached out to professionals around Southern California to offer suggestions, we knew that each area was unique and serving a different travel purpose. In other words, what a traveler might like in a hotel in San Diego could be different from what he or she wants in a downtown hotel.

There are common traits to most business traveler’s desires in hotels. First, rooms must be clean, convenient, and comfortable. Whether it’s for the night or for a week, business people need to adjust to the locale quickly. There’s no better way to start than by opening a door to a hotel room and feeling good about it. WiFi is a must, and while $16.95 a day won’t kill us, it’s an irritation when there’s free WiFi all around. Food should be good or close, or both. In addition to convenient, you have to have a place you can meet at or grab a meal with a client or co-worker. If you’re wining and dining, assume you are leaving the hotel. But for meetings, you need something on site or very close. And there must be some place or things to do to unwind…pool, spa, bar, lounge, etc.

With that in mind, we present our list of business-friendly hotels for Southern California professionals!

Millennium Biltmore

AREA: Downtown Los Angeles

VIBE: The Biltmore is a Los Angeles landmark. It’s old L.A. at its finest. If you’re doing business downtown, this puts you right in the thick of it. Great restaurants, Metro stations, theaters, Convention Center, and Staples Center are just a short walk or Uber away.

STAY HERE FOR: Great place for meetings, big and small. Downtown renaissance is happening all around with great restaurants, bars and taverns nearby. There is great atmosphere here, something generally lacking in Los Angeles properties. This hotel is old-school class. Not for those wanting the “latest and greatest,” but rather a charming old hotel and Hollywood grandeur.

ALSO NEARBY: The JW Marriott at LA Live, the Ritz Carlton, and the Westin Bonaventure are three great options in downtown.

Web: millenniumhotels.com

Ojai Valley Inn

AREA: Okay, it’s not really “in town” but the Ojai Valley Inn is one of the most used “out of town” hotels for people in Los Angeles. It’s close enough to go for the day, yet perfect to go for the weekend as well.

VIBE: Calm, relaxed, country club atmosphere. Ojai Valley is green and gorgeous. Golf, tennis, spa, cycling, horseback riding, and even watersports are all close by. Call it work, but a retreat or seminar here is as much about relaxing as anything else.

STAY HERE FOR: Get away, without going to far. Great service, excellent food, and easy-going style

ALSO NEARBY: The Fess Parker Inn (Santa Barbara), Embassy Suites Mandalay Bay (Ventura)

Web: ojairesort.com

Westlake Village Inn

AREA: Westlake Village, North of San Fernando Valley.

VIBE: This property is a great option for doing business in the northern part of the city. It’s got nice rooms, great grounds, and very convenient right off the 101 freeway. It’s a family-owned property that offers a personal touch. Also, Stonehaus and Boogies are two destination eateries/hangouts right on the property.

STAY HERE FOR: It’s easy and comfortable here. We stayed there, put up clients there, had meetings there, and held press conferences there. Comfortable enough for several nights, meetings, or a North Los Angeles basecamp.

ALSO NEARBY: Four Seasons Westlake Village Spa

Web: westlakevillageinn.com

Luxe Sunset Boulevard

AREA: This hotel is right off the busy 405 at a geographically strategic spot between the coast, Hollywood, and the Valley.

VIBE: The Luxe has kind of a Hollywood nouveau riche feel. The good news is that it’s away from some of the hubbub, which is good for business travelers. Unfortunately, it’s also the biggest drawback, as there is nothing within walking distance.

STAY HERE FOR: Central West L.A. location, great service, and near lots of things 9beach, Getty Center, Westwood, Century City, and LAX (via 405).

ALSO NEARBY: Look to classic Beverly Hills properties like the Beverly Hills, the Beverly Hilton, the Four Seasons, etc., or the Santa Monica hotels like Lowes and Shutters.

Web: luxehotels.com

Hilton Universal

AREA: This hotel is located in the east part of the San Fernando Valley, on the hill across the street from Universal Studios.

VIBE: Some question this choice…it’s more touristy, because of the theme park…not new…and not overly lux. That said, it’s another strategic choice. If you are doing business in Pasadena, Burbank, Glendale, downtown, Hollywood, the Valley, or Santa Clarita, it’s a great choice.

STAY HERE FOR: Close to Toluca Lake and North Hollywood (NoHo), the two east valley hipster hangouts. Lots of great bars, restaurants, coffee shops, etc. Central to most of the studios like Universal, NBC, Disney, and Dreamworks, or if you need to be close to Bob Hope Airport in Burbank.

ALSO NEARBY: Sheraton Universal, Sportsmans Lodge, and all of the Hollywood hotels are options.

Web: hilton.com

Loews Santa Monica Beach

AREA: Santa Monica (beach)

VIBE: Loews is a quintessential new Santa Monica hotel. Thirty years ago, hotels in Santa Monica were dive motels or airline crew hangouts. Since then, Santa Monica has had a rebirth as one of the area’s hottest hotel areas. Great hotels abound, close to the beach, restaurants, and shopping.

STAY HERE FOR: Venice Beach and the iconic Santa Monica Pier are right there, literally. American Film Market headquarters at this hotel, and it’s great for meals, a stay, or drinks by the beach.

ALSO NEARBY: Tons of options, but consider Shutters, Oceana, and Huntley Santa Monica.

Web: loewshotels.com/santa-monica

The Langham Huntington

AREA: Pasadena, San Marino

VIBE: This is old L.A. wealth. Originally the Huntington, then the Ritz Carlton, it’s a flavor of elegance not found easily in Los Angeles. This is in the northeast end of town, near the Rose Bowl and Rose Parade. Wonderful grounds, restaurants, and service.

STAY HERE FOR: Lots of longstanding business are HQ’d nearby. Also close to downtown. This hotel has unmatched elegance, and is easy to get comfortable in. Lots of Pasadena restaurants and shopping nearby. And don’t miss their $100 martini!

ALSO NEARBY: Lots of chain hotels nearby, but nothing like The Langham.

Web: langhamhotels.com/en/the-langham/pasadena/

Embassy Suites by Hilton LAX North

AREA: LAX

VIBE: The truth is, no one likes to stay near the airport, but often we must. If you have a quick meeting, or and early/late flight, you have to stay close. A hotel 10 miles away could be and hour and a half in bad traffic. LAX is busy, and right on the border of questionable neighborhood. Best bet is drop down the hill to Play Vista and Marina del Rey for meals to the north, or Manhattan and Hermosa Beaches to the south.

STAY HERE FOR: Get in, have a meeting, and get out. Embassy Suites offers clean rooms, good value, free continental breakfasts, drinks in the evening, fitness center, and pool.

ALSO NEARBY: Tons of options near the airport. Choose a Hilton, Westin, or Marriott if you want the miles, or head further away to get out of the airport zone.

Web: laxembassy.com

Monarch Beach Resort

AREA: Orange Country beach area

VIBE: Okay, there are hotels near John Wayne Airport and the business district off the 405, but if you’re in the OC, head to the water. Monarch Beach Resort is stunning. On the hills overlooking the ocean, it feels more like a vacation resort or country club, yet it’s home to board meetings, conventions and retreats all the time. Food is excellent. Views are spectacular. Book near a weekend and enjoy a round or two of golf and a couple of days off

STAY HERE FOR: Views of the Pacific, great weather, luxury accommodations, and excellent service.

ALSO NEARBY: Resort at Pelican Hill, Ritz Carlton Laguna Niguel, or Balboa Ray Resort.

Web: monarchbeachresort.com

Marriott Anaheim

AREA: Disneyland and the Anaheim Convention Center

VIBE: So this area is all about Disneyland and conventions. It’s busy, active, and touristy. But a ton of business happens in the area. Fast food abounds, and while there are good meals to be had, you need to look past the masses seeking quick meals while visiting the Magic Kingdom.

STAY HERE FOR: A decent hotel, walking distance to the hotel and theme park. Honestly, flip a coin between this and Hyatt across the street. Both are right up the street from the Convention Center. The Marriott gets the nod for dealing with crowds better. Able to house meetings, promo suites, seminars, etc. Great hotels are hard to find nearby, so settle for really good instead. This is a “go to” for many local business people staying down there for a day or two.

ALSO NEARBY: If Marriott is full, go to the Hilton across the street. Or, pretty much every hotel and motel chain ever imagined.

Web: marriott.com/hotels/travel/laxah-anaheim-marriott

Marriott Marquis San Diego

AREA: This is another city area you wouldn’t be caught dead in 25 years ago, but is now the hub of downtown. Waterfront walk, restaurants, shopping, and entertainment all close by.

VIBE: Downtown San Diego is now a very cool and hip zone. Lots to do, lots of places to have drinks, hangout, and hop around to when between meetings or events. Cars are not necessary, with tons nearby within walking (or Uber) distance.

STAY HERE FOR: If you need to be downtown, near the city center, Coronado, and airport. Also near Balboa Park, and freeway close if you’re heading north or east.

ALSO NEARBY: Manchester Grand Hyatt, Hotel Del Coronado, or the Patani or Lodge if you want to stay a little north in Torrey Pines.

Web: marriott.com/hotels/travel/sandt-marriott-marquis-san-diego-marina •

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The AP released a story earlier this year that projects more than $7 billion in value as an industry, and more than $1 billion in tax revenue locally. California’s appetite for pot reflects more than 10% of the country’s pot business.

But licensing, control, and regulation as lagging behind the investment efforts. State Senator Mike McGuire commented California is, “Building the airplane while it’s being flown.”

In large part the reason is that California is trying desperately to “get it right”. Doing it wrong could result in loss of regulation, loss of tax revenue, and a huge black market.

The effort of California, and other pot-legal states, for that matter, appears to be part of the high stakes game playing out on a national stage. The federal government, under President Obama, basically told states to vigorously control and regulate state operations, and the Feds would stay out. But under the new Trump administration, word of Federal crackdowns is growing.

In a recent Time Magazine article, University of the Pacific professor Mike Vitiello, a marijuana law expert , doubts the Feds can pull it off, saying, “It’s kind of like illegal immigration: You can’t build a wall high enough.”

Only time will tell if pot will be the second wall built by President Trump. •

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Business consulting often focuses on the most tangible challenges: cash flow, supply chain, work flow, job descriptions, salaries and bonuses.

In my work with companies and corporate teams, I often take an “inside out” approach. “Inside out” focuses on that which is not so easily seen and often can be a far more powerful inhibitor of successful operations. We see four (among many) factors that, once identified can create a pathway for improving personal performance of employees and managers.

The so-called negative employee. We all know and recognize this person and it’s easy to demonize them. We have found numerous examples that may seem to you to be “counter intuitive.”

The negativity you see often hides a strong desire to positively impact a team through naming what’s wrong. We call this employee the “truth teller” and he or she is easy to dismiss because what they are saying is not well said or is said with so much emotion we feel uncomfortable listening. As in ancient times this messenger of necessary information can be a victim of “kill the messenger.”

Solution: Find a leader who isn’t afraid to listen carefully to all the complaints this employee brings. Honor each one and create a leadership meeting where the complaints or criticisms are seen in a non-emotional objective light, and then decide what’s valid.

The orphan. Within every organization there are insiders and outsiders. Like the school yards of our youth we all want to be part of the in crowd. The “orphan” will linger on the outskirts if not seen for their unique contributions, their work ethic, perhaps their shyness and their reluctance to speak up.

Solution: Empower this employee through intentionally welcoming their input, inviting them to small group gatherings, asking for their help with a project not necessarily in their domain. Offer a little training or coaching where they need it. Seeing it, naming it, acting on it will change the complexion of your team.

The narcissist. This person creates more attention for themselves than is warranted and causes anxiety among team members. They may look good but their self referencing all successes of the team undermines loyalty, goodwill and focus.

Solution: A good muscular interview exploring their needs, their true contributions, their own exploration of their effect on the team—can open the way to coaching that focuses on building a realtime relationship with leadership. Remember: the narcissist wants to be seen, wants to be important. Give them a pathway where they can, in a healthy way, achieve that.

The addict. Addiction is not only about alcohol and drugs. It is a personality style as well. The addict can’t stop themselves from smoking/eating/drinking/working/gossiping, etc.

Solution: This employee needs help but it must be artfully offered. Intervention should be by design using leadership that is itself insightful, kind and proactively oriented. Acknowledge their contributions, probe (a little) around whether they self diagnose their own situation, offer outside the office help (if appropriate) and make a coach available to them. If successful this somewhat driven employee will become even more valuable to your organization as they gain some (inner) control over their demons.

Hidden factors, mostly psychological in nature, can when addressed, fuel real growth in team performance. Work to identify them and then to turn them into positives for your company. •

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During my many years of learning about networking and fostering relationships, I have probably heard every networking myth (i.e., excuse for not putting forth the effort to network). Let me dispel at least some of them.

One More Contact

“I have enough contacts. I do not need to establish one more.”

That may well be true for you, so you think. What a burden it is (he said, factiously) to spend the time to connect with another…(fill in the blank).

My answer is “You Never Know.” That very next person may be your very best connection, friend, business client, etc. Why not be open to at least a phone contact, especially if you trust and respect the person who is giving you the connection? Do you have confidence that she knows you well enough to make the effort to connect you?

In our business and personal lives, there are obvious direct links, people with whom we can develop meaningful relationships. So what about the randomness of a next contact? Many network groups have copied the ProVisors troika concept; that is, arranging a meeting of three people outside of the large group meeting. This setting typically enhances the in-depth understanding of one another’s business and personal life. If a relationship is meant to develop, the troika is a key ingredient.

Now, suppose that one person in the troika is not a direct link, referral source, or resource. Yet, that person has a family connection to a large business, one which really needs your services. The randomness of making connections occurs more often than you might think. Besides, even if there were no direct link or the “random” family business, you can still show up and find out how you can help that person.

Many people resist that one more contact because they feel it is a burden or obligation. How can they befriend someone new, send them business, or serve as a resource to them? You can always find ways to give to someone else. That giving does not have to include a new client.

Don’t Like Small Talk

“I hate small talk. It is tedious and boring. So how do I avoid it?”

Most people want more than chitchat or small talk. But some of it is necessary as a way of greeting others or not being awkward in social settings. Small talk can lead to deeper conversations, or you can direct it there. The art of the segue is probably the most underrated personal communication skill. Often, humor is a good way to switch topics or focus in a conversation. Use it if it is a natural part of your personality. False or stilted attempts at humor are worse than not invoking humor. Be true to your self. The best way to improve your communication style and impact is to get help from a professional coach who can personally train you.

I do not consider myself the most inspirational or ideal public speaker. I am much better, and more comfortable, leading a group setting, whereby I can interact with others and respond to their dialogue and comments. Prior to presenting to an audience, I have the natural or normal trepidations. I find it interesting that some people are perfectly comfortable giving a prepared speech, but very insecure in a first one-on-one meeting. Find your level of comfort and work to improve it. It may be the difference between being average or successful. Like most speakers/presenters, the more I practice my delivery, the better the outcome. In Own the Room, the authors explain that good preparation does not mean memorization or reading from a teleprompter. It does mean knowing your materials, capturing a tone and rhythm, and then sharing yourself with your audience. To that end, I enjoy presenting at least a part of me in every talk.

Networking is Beneath Me

“I am a senior professional/executive. I will likely never meet or connect with someone on my level.”

Maybe not, but why preclude the possibility of making that connection? EVERY HUMAN NEEDS AND WANTS TO BE CONNECTED TO A LIKE-MINDED COMMUNITY. I think even Henry David Thoreau left the wilderness to return to some societal connections; and, maybe to get his writings published!

Each of us knows or knows of high-powered, well-connected people who were born into privilege. Some have been mentored by industry or political power brokers. Some have just insinuated themselves into and among high level connections that provide a continual flow of capital, opportunity, career moves, or access to the right resources. Still others have parlayed family members or legacies, or offspring of the wealthy, into situational success. At the same time, the above examples of apparent access to money, power, or higher levels of achievers were really accomplished by connections to the “right” people. The central tenet is still about relationships. My supposition is merely that, at some time, everyone needs help from someone. Starting with clubs or sports as kids, people begin to belong and make friends. There are numerous types of loose or well-structured organizations that proliferate in our personal and business lives.

Margaret Wheatley, a consultant who studies organization behavior, concluded:

Relationships are all there is. Everything in the Universe only exists because it is in relationship to everything else. Nothing exists in isolation. We have to stop pretending we are individuals that can go it alone.

Author Mitch Albom (Tuesdays with Morrie), stated: “Build a little community of those you love and who love you. We all need that core community of love. Without it we are either lost, adrift, or without purpose and meaning in our life.” The stronger that love corridor, the easier it is to put yourself out there, and fail.

As a junior and senior in high school, I had been told by a local business person that I would receive a full scholarship to the University of Michigan for basketball and baseball. Looking back on that time, I was never in direct contact with the head coach for either sport. I was relying on the word of a local “scout,” since I did not understand the recruiting process. How naïve of me, or maybe how relatively unimportant I was to Michigan.

The only other school to which I applied (and was accepted) was Dartmouth. My high school football coach and Athletic Director talked briefly to the Dartmouth coach when he visited our high school. Though I played football in high school, I was not planning to play that sport in college. He knew I also played basketball and baseball, so he emphasized the academics and the fact that I could play these other sports.

I made a recruiting trip to Dartmouth with my parents. What a stark difference in athletic emphasis and facilities between the two schools (Big 10 and Ivy League), to say nothing of the talent disparity.

When I was sent a letter by Michigan’s basketball coach and asked to walk-on (not granted an athletic scholarship), I was extremely disappointed. My entire life’s focus and athletic dreams had included playing at The University of Michigan. The Ivy League, which included Dartmouth, did not (nor does it today) provide athletic scholarships. I was granted a student loan to Dartmouth, which allowed me to matriculate there.

How did that setback or failure turn out? It wasn’t all bad. I played both sports at Dartmouth, earning All-Ivy honors for three years in basketball. And, I got an excellent education.

Whenever I have been forced to take a new or different path, I have made it work. But not without “falling down” on occasion, or struggling financially. Remember why I created the networking organization. I was forced to figure out how to survive and build a business, unlike any of my other past experiences.

Too Young To Network

“I lack the experience to talk with or share anything with most of the people I meet. They will not pay attention to me.”

As PNG was growing slowly throughout the 1990’s, there was some thought to attracting younger professionals with great upside potential. But the older pros were resistant, wanting to keep the community serving their needs. The strong younger ones persisted; a few even became group leaders. It is at this level, group leader (GL), that you are accorded an elevated level of respect. You not only decide which persons can join your group, but how the meetings will be conducted (given the basic framework within which all groups operate).

ProVisors has adapted well to accommodate all types of professionals, including many in their ’30s and even late ’20s. The pressure is on these younger members to deliver ideas, connections, and referrals. So long as they share first or pay it forward, age differentials disappear. In fact, many groups target younger people, attempting to create a more energetic, fresh communication.

Obviously, you are never too young or too old to begin networking. Parents should encourage their children to build relations and friendships very early and often in life. As you find your passion/occupational path, you may want to reach back and out to these prior connections. When I left ADLV in 1987, I had no more than 6 names in my Rolodex. From that paltry number, I contacted a senior person at KPMG. He was kind enough to hire us for one of his clients, a valuation engagement that was large enough to carry our firm for several months. But no one should be in that desperate a strait. I was very fortunate for the great business jumpstart. I will never be in that dire position again, nor should you.

What else can you do as a younger professional or executive? Most importantly, get out of the office. Even if your primary job is not to generate business, will anyone in your firm turn down a good assignment that you originate?

Here are a few ways to start branding yourself, even as a younger person:

1. True passion trumps all. Express what you are passionate about, though in a matter-of-fact way. We are drawn to the person who can articulate why she enjoys her work. That makes us more curious about how we can help her.
2. Give. Give. Give. Find out what is meaningful to others, even seasoned veterans (old folks!), and reach out to offer something. Giving to others triggers the “human guilt switch.” When we receive something of value that we did not solicit, our brain receptors are wired to record that occurrence in our long term memory. Especially unforgettable are those key introductions you make that result in a new friendship or business relationship.
3. How many actors who “suddenly” become famous did not toil in some anonymity for years? Very few.
4. Arrange meetings with your elders and learn from them. Find out how they forged a career, and what can you do to best present yourself. People want to help eager younger people. So ask.
5. Organize a mastermind group of younger professionals. Develop a chemistry with those in the group most likely to be resources and referrers for you and your clients. While you should always be open to receiving, the best way to be a receiver is to start by being the giving quarterback.
6. Start your own firm or move to one where your value is better appreciated. There may be a time when you are ready to go on your own, or with a few partners. Choose those partners wisely, with clearly defined roles, compensation, life style, decision-making procedures, etc. The ultimate arbiter of a successful venture is the trust in one another. If complete trust is lacking, wait for a better opportunity.

I have experienced good to awful (painful, in fact) “partnerships.” Spanning my business career, I have started five firms, bought one, and sold four. That leaves two companies that I continue to own and operate. Most of us need to work cooperatively with others, in our firm or outside. The least successful of my ventures were those whereby my reliance on others to deliver their promised output did not match my expectations.

No Need to Network

“I have no desire or need to network. I am busy enough.”

I wonder how many people who said that before 2008 can say the same thing today. For the vast majority of professionals I know, there is a new normal of activity. The hectic pace of work from 2003 to 2008 has been replaced with periods of less demanding workloads, punctuated only periodically by high activity reminiscent of that five year period.

I also think that those who go to lengths to avoid meeting with others outside your firm are just more reclusive. If you never have to worry about your next engagement or where you need to spend your work time, you are blessed.

However, you are also missing the opportunities to learn vital and current information from others, often useful to your clients and/or other executives in your firm. And, you are not taking advantage of the personal growth which occurs each time you interact and refine your message or brand. These interactions are constructive in terms of furthering your career and your connections with key persons in your “space,” industry, or the community at large. Reframing an old adage: “Never turn away a potential gift-horse in the anticipation that it is a Trojan horse.”

My Work Sells Itself

“The quality of my work sells itself. I will always have clients come to me based on my professionalism.”

They may, and they may not. Clients are more fickle these days, requiring more attention, positive reinforcement, and some fee concessions. Since 2008, in most professions there is increased scrutiny of our services and fees. The downward fee compression is particularly vexing, since the financial, accounting, and tax standards for quality and work product are much more stringent.

The best way to ensure a steady stream of prospects and repeat clients is to perform to the utmost of your ability and standards. That is axiomatic. However, without our at least highlighting the benefits of our work, some clients will never know how well we performed. You can be a major “megaphone” for other professionals simply by reinforcing the high quality of their service to common clients, prospects, or referral sources. A complement from a respected person usually carries more clout than self-proclamation. •

Naked Without A Network is Davis Blaine’s second book and is available on Amazon.com.

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Knowing that you want to sell is easy. You decide that. Knowing when to sell, well now that’s a bit tougher. Will the market go up, or down? Is your business packaged properly for sale? Can you demonstrate real value and cash flow?
This all brings us back to the core question, is now the time to sell?

What You Need To Know Before You Sell Your Business

Today’s business buyers are much more sophisticated. There is a lot of information out there (internet, books, magazines) that can be good or bad advice on how to buy a business. What is important to understand is that buyers are looking for stable, quality businesses that can demonstrate the success of the business will continue. Buyers put the most weight on “cash flow.” This is also known as Seller’s Discretionary Earnings (SDE) or adjusted net income. It is crucial that cash flow is calculated correctly and that the process of how cash flow was determined can be supported by documentation. Most sellers focus on the multiple, which is important. However, I pose the question, “A multiple of what?” If the historical cash flow is not calculated correctly, then the value may be under estimated. Buyers need to feel 100% comfortable with the historical cash flow figures or trends since this is what will determine what is available to cover debt service, salary and expansion or growth.

The multiple of cash flow used is a function of many things. There are more than 15 characteristics that affect the multiple. Some of these increase the multiple and some of them can decrease the multiple. It is the multiple that takes the good, the bad and the ugly into consideration. Some of the factors that affect the multiple are consistent historical cash flow, type of industry, years in business, the condition of the facility and the furniture, fixtures and equipment (FF&E), key employees in place, terms of the lease, the type of financing available plus many other factors. An experienced Certified Business Broker can discuss this further and assist in establishing the correct cash flow and multiple for your business.

Pricing Your Business For Activity

Pricing a business is part science and part art. It is no secret that sellers aim high and typically overprice their business. What sellers underestimate is when a buyer is looking at multiple businesses for sale and he or she sees that the multiple is out of the normal range, the buyer will then assume the seller is unrealistic and will most likely pass. This means you may have lost an excellent, qualified buyer that would have been interested if the business was priced correctly. Pricing your business should be taken seriously and be treated in a professional manner that can be supported, otherwise everyone’s time is wasted.

It pays to be realistic. Many sellers assume that the amount of money they need to retire or need for their next venture is somehow related to what their business is worth. That is wishful thinking and obviously not how the value of a business is determined. Studies show that there is usually a 10–15% difference between what a seller wants and what the market will bear. A Certified Business Broker has considerably expertise when it comes time to calculate a reasonable asking price for a business. They know that it is essential that they come up with a price that is fair. As a result, a Certified Business Broker will take many diverse issues into consideration.

Being Prepared Pays Dividends Down The Road

The time spent at the beginning of the process of selling a business can pay big dividends down the road. It is important to prepare your business for sale. What does that mean? Don’t be reactive—get your house in order before you put the business up for sale! Spend time to review your overall business. Review your processes, your policies and procedures, company financial statements/tax returns, inventory, accounts receivables and payables, review the condition of your equipment, the condition of your facility, review your lease agreement, your employee records and compensation, etc. Think of what you would want to see if you were purchasing a business and act accordingly. The more you can address upfront the better position you will be in when a buyer is at the table. One common statement I hear from business sellers is how they underestimated the time needed and overall what was involved with the sale of their business. On average, it can take 6–12 months to sell a business. Selling a business is a group effort that will involve you, key executives, and your financial and legal advisors all working in a coordinated manner with your Business Broker. Beginning with the gathering of information, through the transaction closing, you need input about all aspects of the sale. Being prepared up front will help this process go smother and more efficient for everyone involved.

In conclusion, selling a business is a time consuming and complex process. It involves knowledge and expertise in a wide range of fields and topics. It is important to understand the dynamics and the many factors that are involved in the sale or purchase of a business. No two businesses or deals are alike. Working with an experienced Certified Business Broker will help in dramatically increasing the probability of selling your business. An experienced Certified Business Broker will assist the business owner in the proper “confidential” way to prepare the business for sale. In addition, a Certified Business Broker will prepare a financial analysis and opinion of value, professionally package the business, put a professional confidential marketing plan in place to reach a wide audience, negotiate and structure a fair deal for all involved, prepare and manage the due diligence process, prepare certain contracts, handle the transfer or creation of a new lease, assist in financing the transaction and manage the entire process from beginning to end to assure confidentiality and so that the seller can focus on successfully running their business. •

CASE IN POINT:

The Importance Of A Lease Agreement And Timing

A husband and wife owned and operated a highly successful 27-year-old garment manufacturing and wholesale distribution business. The couple discussed several times the possibility of retiring and selling the business since the business was doing well. As the saying goes, time is your enemy. Unfortunately, the couple had personal problems and eventually filed for divorce. In addition, shortly after filing for divorce, the wife was diagnosed with cancer. The business owners were fortunate that they had strong, long terms employees who stepped up and ran the business effectively. The husband checked out and left the wife and employees to run the company. The wife was now dealing with running the business, going through a divorce and cancer treatment. The company was stable for the next couple of years. The ex-husband became difficult and uncooperative with the divorce. The ex-wife wanted to sell the business and went to court to receive a court order for the sale of the business. The courts agreed that this was in the best interest of both parties and ordered the business be sold through my firm.

After several meetings, we moved forward to represent the parties in the sale of the business. As we normally do in the course of our work, we analyzed the lease agreement that was in place. I mentioned to the owners that the lease agreement is going to be an important factor in this transaction. Since this was a divorce situation, the owners would not agree to seller finance. I informed the sellers that since the company tax returns were strong, I felt comfortable that the business would qualify for SBA finance once we had a strong buyer in place. I pointed out that since a SBA loan is typically done on a ten year term and that their facility was crucial to the success of the business, the SBA lender would require the total term, including options for the lease agreement be no less than ten years. The sellers were adamant that I not speak with the landlord until we had a buyer and that there should be no issues with the lease. I explained to them that this was risky and that we should contact the landlord to make sure we would not have any issues. They were insistent and we moved forward.

We spent the next month preparing the business and our package. We then put our marketing plan in place and started speaking with prospective buyers. We had numerous meetings over the next several months until we met with a charming husband and wife team that expressed enough interest for us to move forward. The husband and wife team were both looking to leave corporate America to purchase their own business. They were sophisticated and knowledgeable about the process of buying a business. We had several in person meetings and early on they asked about the lease for the facility. The owner commented that they were currently on a month to month lease and they did not want to contact the landlord until we were in escrow. The buyer expressed concerned since this was an important factor in being able to determine a price and obtain SBA finance. I told the seller that my SBA lender will need to make sure we would not have any issues with the lease and that I should contact him sooner rather than later. If the lease is going to be an issue, then the buyer will need to factor in the cost to relocate the business into the offer and the SBA lender will also need to factor this in.

Once again, the seller was insistent that we should wait until we were in escrow. The conversation continued and eventually the buyer submitted an offer that was accepted.

The buyer started their due diligence and worked with the SBA lender on providing what they needed. The question on the lease came up several times and we had no choice but to respected the owners request to wait until we open escrow. The buyer approved the books and records, we moved to an asset purchase agreement and opened escrow almost a month later. The seller then gave me the thumbs up to contact the landlord. I contacted the landlord and to my surprise, the landlord said that he was doing the owners a favor by not increasing the rent and pushing them to sign a new lease. He informed me that this would not apply to a buyer or new owner. The landlord was clear that he would want to bring the monthly rent up to market rent and that he would only consider a five year term. I explained to the landlord and the owners that this would be an issue. The buyer will now be faced with higher rent (an increase of $1,000/month) and this would decrease the cash flow and therefore decrease the value of the business. Furthermore, the SBA lender would not consider financing unless the terms of the lease (including the options) were the same as the term of the loan, 10 years.

To add insult to injury, the landlord said he was going out of the country, on a 14-day cruise and unreachable. We were now about 8 weeks into this transaction from the first time we met with this buyer. It took another 3 weeks to wait for the landlord to return, work out a 10 year lease (5 + 5 year option) and we unfortunately had to renegotiate the purchase price due to the increase in monthly rent. The buyers were extremely frustrated but in the end, we received a new lease, obtain the SBA financing and closed the transaction. The landlord asked why we did not contact him sooner and I replied the sellers were insistent that I not reach out to you until a buyer was in place because they were fearful of what you would say. His response was, “This could have gone a lot smoother if they would have just contacted me upfront.”

Of course I agreed!—M.C.

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Women are far more forthcoming about their stress load with trying to “keep all the balls in the air” when it comes to work, kids, marriage, aging parents, social calendar, social media, etc. But men are much more reticent talk to a woman about their “balance” being in danger, let alone being completely off kilter. Why?

According to an article late last year by Caroline Fairchild that was posted on Fortune, “Men just don’t bring it up. That’s the finding of a recent survey out by Citi of more than 1,000 male and female LinkedIn members. Nearly 80% of women surveyed said they have never heard a successful man talk about balancing work with home. Still, over half of men said they have heard other men engage in conversation about work-life balance. The survey shows that while men may not be open to discussing these challenges with women, they are struggling nonetheless.”

I had lunch the other day with a colleague whom I admire and respect. He was struggling with the concept of having a conversation with his girlfriend about the recent challenges he was having with running his IT business. “I don’t want to put added stress on her. If she thinks that I’m having issues with my business, she may think less of me. She has enough to deal with already….”

My response was this, “If you expect her to be open with you with all of the things going on in her life, you have to share with her all the things going on with you in yours. That’s what a relationship is about. S-H-A-R-I-N-G. She will be there to support you and you’ll feel better.”

I think that men are basically hard-wired to be a “provider” and to suck-it-up when things get rough in the business world. Perhaps they feel that their partner won’t understand the stresses that go hand-in-hand with running a business. WRONG! If your partner loves you, SHARE with them. They will probably surprise you.

With regard to spending time with one’s children, do it. You truly don’t get this time back. I recently was sharing with another colleague that my husband and I must take a family vacation with our daughter this year. “She’s about to turn 15. We’ve only got her for another 3 years, at best, before she won’t want to spend any time with us or she’ll be too busy with college.” My colleague (a young man in his 60s) turned to me and said, “Do it. I did it with my 3 kids before they were too old and too busy. It was the best thing I could have done. I took the time away from my business and guess what? It survived and I was a better person for taking the time away with my kids.”

In the article, Fairchild quotes Linda Descano, head of content and social and North America marketing at Citi, and president and CEO of Women & Co., Citi’s personal finance resource for women, ” ‘It’s clear from the findings that men need to be a bigger part of the work-life balance conversation – and that we could all benefit from more communication about a variety of career issues, from the way we promote our work to how much we think we’re worth.’ ”

We need to encourage all business women and men to talk about their balance, especially men, since they tend to feel more isolated in their thoughts and ideas. Play, laugh, talk, cry and talk some more… it’s all helpful. Ideas and solutions to balancing out come from remarkable sources. Try it.

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Facebook just went public. Initial valuation estimates were between $90-120 billion. In some people’s minds, this company was worth more than McDonald’s, Bank of America, Kraft Foods and/or CitiGroup before a single share of stock was sold. Really? Yet, look at the hit the stock took on its second day of trading. Where is its real value?

Facebook does have more than 900 million sets of eyeballs that make up its user base. There’s definitely value in that. But how much value? Currently, it’s generating a couple bucks of revenue per user annually. That’s not much, and it’s far below the industry norm. Google generates nearly 8 times that in per-user revenue. What does it mean when General Motors just pulled its plug on advertising on Facebook since it was not helping them sell cars? Certainly nothing good.

Other than users, what are the assets? McDonald’s has recipes, stores, franchise revenue streams, real estate, trademarks and subsidiaries generating tons of revenue. Bank of America has loans, fees, credit cards, mortgages and other revenue sources.

I’m reminded of AOL, which if you recall, was sold in 2000. It was valued somewhere north of $150 billion, only to become one of the largest value declines in history. It’s currently estimated to be valued at around $5 billion or less.

What is a company worth? Or a product? Or a piece or art? Well, the simple answer is, “What someone will pay for it.”

Here at Southern California Professional, it’s fun to follow the rare big business news such as the Facebook IPO, but we live and breathe the realities of everyday business. We’re more concerned with your business, your clients and your products and services.

Maybe you’re an M&A attorney or an accountant helping a client buy a business. Maybe you’re a business owner who someday wants to sell your business, but your biggest concern is making it more profitable now. You live in a more realistic world of day-to-day business.

You’ve come to the right place. We’ve put together another issue full of business, legal and financial insight to help you do better at what you do. The information in this issue will truly help you find and increase the value of your business. So sit back and enjoy another great issue of Southern California Professional Magazine! •

Jerri Hemsworth
Publisher

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Every business owner wants the maximum value when he or she sells a business. Not many succeed. What prevents business owners from generating higher value? By looking at several critical factors, we can see what creates higher (or lower) value in a business.

The problem stems from the fact that most sellers do not fully comprehend what drives value for buyers of a particular business. More importantly, they do not usually consider or know the best “windows of opportunity” for selling. Many sellers today are fixated on terms and conditions that will never be accepted, rather than trying to understand the nuances of legitimate compromise.

Sellers today are also usually not prepared to fully support the mercurial adjustments to EBITDA (Earnings before interest, taxes, depreciation and amortization, or the cash-flow basis to which a pricing multiple is applied). Private firms typically co-mingle some personal and business expenses. The true reflection of EBITDA would include adding back “personal” items not readily apparent in the financials. These items can have a dramatic impact on the true financial picture of a company.

Finding Value Drivers

So, how does a seller prepare for and execute the appropriate deal? The first step is to assemble competent and trusted advisors. Using a well-qualified valuation firm and investment banker (IB) are often necessary. Together, they can determine the exposures and carry-over liabilities most acceptable to the seller, as well as understand and explain the value drivers to the buyer(s).

A value driver is one aspect of a business that is crucial to overall value. Somewhat in order of importance are the following:

1. Management: A well-run firm has experience and expertise at several levels. In addition to the visionaries and top-level leaders, mid-level executives are key to effective, daily operations and execution of business strategy. If one or more persons in senior management does not remain after the sale, the buyer typically wants the next layer of leadership to fill that void. The key aspect of the post-sale transition is the meshing of cultures. Nothing harms or destroys an organization faster than in-fighting or politics and a culture of uncertainty and negativity.
2. Cash Flow: A strong gross margin (GM) is a key ingredient of a high-value company. Has the seller improved the GM in the last few years? Solid and flat is fine for established sellers; but nicely growing firms should find methods to improve gross margins. Is the seller affected by seasonality of sales? For some buyers, this is a detriment to business value. Adequate working capital is another key aspect, as is the growing (or declining) need for capital expenditures. Solid growth in cash flow or EBITDA (and not peaks and valleys) is probably the most important factor among value drivers, after the breadth and depth of management.
3. Market Share: The position in the industry (ranking in terms of revenue) or industry niche is a critical aspect of value. In addition, how strong is that position? Is the firm strongly affixed at ­Number 2, for example, or is it on the decline? The intensity of current competition could detract from one’s value, as well as the ease of entry for fast-charging newer firms.

A More Complete Picture

While the management of a company, its cash flow, and its market share are critical value drivers, there are more. So to paint a more complete and accurate picture of the value of a business, let’s look further at some additional value drivers and factors.

Product/Service Uniqueness: If a seller has very distinct products or services, the company should ensure that the intellectual property (IP) is protected. That protection should include all locations where revenues are generated (U.S. states and foreign countries). IP protection encompasses many facts—from patent applications to copyrights; from brand names to goodwill; from proprietary technology (not patented) to R&D; and from clear ownership positions to restricting employee access to or theft of IP.

Well-documented and secure IP allows for and enhances the seller’s increased value. It may preclude easy entry to a market, as well as lengthen the time it takes for a competitor to capture profitable market share. The longer the length of time a company has been in business is just another feather in the hat of the selling candidate.

Issues of Size: Larger companies usually have more customers and are better able to lose a few than a smaller competitor. For example, companies larger than $25 million in revenues command higher multiples than those below this level. Again, without significant customer concentration, larger firms are usually more stable and less risky.

Diversification: Diversity of products or services is usually a plus, in that product life cycles overlap and revenue growth can be sustained. Other factors that drive or detract from value are the size and prior years’ volatility in the industry, as well as long-term prospects and viability. Buyers always want more stable, predictable outcomes, with improving metrics for per-customer revenues, costs and profits.

Systems and Pro­­cedures: Buyers do not expect the ideal systems and procedures (S&P) will be in place at the seller. ­However, without solid and viable S&P, there is an added cost to improve them, and probably a loss in value. More important to the buyer is that the lack of good S&P is a red flag for other potential problems. Possible questions a buyer will raise include:

The list goes on from here, but you get the idea.

Selling In Today’s Environment

Several factors bode well for selling a business today. The sale cycle has elongated since 2008, likely adding three months to the 6- to 12- month norm. However, there are these very positive reasons for deciding to sell your business now:

While this is not exactly the perfect M&A storm, it is likely the economic environment we have seen in the past four years. Business owners who have been waiting on the sidelines can be more confident of sale intentions, but still have to take adequate steps to building a strong advisory team, and building strong value in their companies.

By understanding what drives value, particularly from the buyer’s perspective, business owners can seek to maximize business value and thereby maximize the sale potential. •

CASE IN POINT:

Turning Value Drivers Into A Successful Sale

The owners of a company in business for more than 40 years recently made the decision to begin positioning the company for sale. They knew that they would need a year or so to prepare the company for sale. The powers that be began the process of organizing and improving internal affairs to maximize the sale price.

The company provided specialized, high-quality products and services for a sector within the construction/remodeling industry. Products included many types of sealants for retaining inside temperatures; heat/cold; fire retardation; driveways and pavements; and general caulking. In addition, the company manufactured specialty and ornate doors and windows, framing products, industrial ramps, and mechanized inventory access systems.

The company enjoyed steady growth in revenues and profits the last five years, and integrated several acquisitions into their national firm. The Mentor Group was first engaged by the company to help identify and analyze the company’s value drivers and understand their impact on a sale. After thorough research in the company’s financial aspects as well as their industry standards, we looked at management and operations. ­We provided suggestions to improve operations and consolidate the diverse but related business lines. We also counseled them to put in place the appropriate senior- and middle-level management to make potential buyers more confident of a purchase.

Once our initial business and IP valuation was complete, the company hired us to initiate the sale process and execute a sale of the company. Our first task was to raise $20 million of senior debt to retire the unfunded ESOP repurchase liability and improve working capital. From there, we were then able locate potential buyers, negotiate terms of the transaction, and complete the successful sale of the business This was accomplished largely based upon the clear presentation of the value drivers and EBITDA add backs.—D.B.

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