Carl L. Sheeler

Equity Value Enhancement (eBook, PDF)

A Tool to Leverage Human and Financial Capital While Managing Risk

• Format: PDF

Produktbeschreibung

A detailed look at risk identification and value creation in private equity investment Equity Value Enhancement ("EVE"): Governance, Risk, Relationships & Knowledge ("GRRK") provides the information and tools practitioners and business owners need to work with the multitude of intangibles ("GRRK") in equity investment decisions. The author engages readers with an insightful and brief claim: "Values are more than numbers." He then provides support for just how important human capital is to the value creation paradox. He doesn't stop there because ideas without definitive actions don't promote transformation. He further challenges the reader with: "If you don't think outside of the box, you're doomed to live in the box." A user-friendly manual chock full of vignettes, suggestions and pithy commentary EVE is a must read for owners, officers, boards and advisors to derive understanding of business value drivers. This book teaches the reader how to conduct more intangible asset due diligence as well as what decisions and behaviors impact value. With more effective methods of risk identification, measurement, management, and mitigation ("IMMM"), trusted advisors and owners can establish a "working on the business" strategy to prioritize issues impacting a company's intangible assets - assets which almost inevitably create the largest component of value in flourishing companies. This focus also serves to reduce risk while leveraging human capital and operational effectiveness. This book challenges users of value enhancement and valuation services to demand greater intellectual rigor to best serve owners/investors of the United States' economic engine--the midmarket company. Therefore, readers are challenged to look beyond the common metrics and numbers. They are admonished to rely less on formulaic approaches and on software that can generate spurious opinions. The reader is called to action by the author, a US Marine Combat Officer veteran, to lead the change: "You burn the boats if you want to be sure you succeed taking the island." Trillions of dollars of private equity are changing hands as Baby Boomer owners and investors seek greater liquidity and legacies while investors seek higher returns from direct investment in private companies. This book provides risk and human capital guidance removing some of the guesswork on valuation and value creation. * Provide better evidence of value & equity discounts * Identify and quantify risk and provide tools to manage it * Inform better business management and investment decisions * Create a more comprehensive valuation for equity investments * Roadmap and strategy for enhancement of going concern value Governance, Risk and Compliance ("GRC") management are hot topics in today's economic environment. The familiar financial metrics may not be providing adequate indications of value creation - the core principle of most shareholder investment expectation. To identify risk and work with it effectively, practitioners need an in-depth understanding of the forces at play. Equity Value Enhancement is a detailed, insightful guide for making better equity decisions. Finally, the author puts his passion front and center by offering the reader the opportunity to invest in the human capital this book addresses by encouraging support of military veteran's with combat PTSD so they may be productive citizens with the leadership and business skills provided by our country's "Greatest Generation."

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Produktdetails

• Verlag: For Dummies
• Seitenzahl: 368
• Erscheinungstermin: 8. Dezember 2015
• Englisch
• ISBN-13: 9781119092025
• Artikelnr.: 44368715

Autorenporträt

CARL L. SHEELER, PHD, ASA, is the managing director and global group leader of family office and business strategies at Berkeley Research Group, LLC--a 900+ staff global business litigation and advisory services firm. He is also the founder of Business Valuations, Ltd./Allison Appraisals & Assessments, Inc. and co-founder of Privatus CI³O Services, LLC. He has performed more than 1,200 high-profile litigation, valuation, and restructuring engagements from midmarket to national companies. He has testified more than 170 times on matters ranging from IRS taxpayer to shareholder disputes and assisted hundreds of clients on the measurement, creation, management, and defense of more than $50 billion in values. Carl is also a Manager of the Two Bears Ranch, LLC, formed to receive the proceeds from the sale of this book which will be used to serve combat PTSD veterans and at-risk horses and dogs. They will be healed through equine and canine therapy. Donations, grants, and ranch operation revenues will also subsidize this cause. If interested, contact Carl at his website at www.carlsheeler.com or www.twobearsranch.com.

Inhaltsangabe

Foreword xv
Preface xix
Acknowledgments xxxi
About the Author xxxiii
Author's Vision and Challenge xxxvii
Chapter 1 Value ABCs 1
Capital and Risk 4
Understanding Assets 5
Plugging the Gap 7
Notes 8
Chapter 2 Focus on Trusted Advisors 9
The Path to Being the Best 16
Question Yourself 18
Taking It to the Next Level 19
Notes 22
Chapter 3 Focus on Business Owners 23
The Role of Advisors 27
The Cost of Bad Advice 28
The Value of Leveraged Knowledge 29
Engaging the Best 31
Practical Vetting Suggestions 32
Size and Scope Considerations 33
Setting Expectations 34
Note 44
Chapter 4 Risk in the Eye of the Beholder 45
Inexperienced Business Appraiser Lenses 47
CPA Lenses 48
Attorney Lenses 51
Investment Banker/Business Broker/Business Intermediary Lenses 52
Commercial Banker Lenses 54
Insurance Professional Lenses 55
Wealth Manager/Financial Advisor/ Fiduciary/Trust Officer Lenses 55
Research on Risk and Returns 59
Economist Lenses 60
MBA/PhD/CFA Lenses 61
Owner/Family Lenses 63
Family Business Advisor Lenses 70
Staff/Vendor Lenses 71
Client Lenses 75
Notes 80
Chapter 5 The Role of Governance 81
Governance 83
Focus on Culture 84
About Boards, Governance, and Strategy 85
Healthy Board Governance and Strategy Creates Value 87
Strategy and Equity Value 90
Family Harmony and Legacy as a Governance Driver 93
Board Strategic Direction and Accountability 94
Board Structure and Member Traits 95
Governance and Risk Management 97
Qualitative Value Measures 98
Taking Control 99
The Secret Sauce 101
Governance Measurements 104
Governance Takeaways 106
Notes 106
Chapter 6 The Role of Relationships 107
Client Relationships 112
Advisor Relationships 114
Commercial Bankers 116
Investment Bankers 116
Insurance Agents 118
Wealth Advisors 120
Board of Directors 121
The Bottom Line on "Free" Advisors 122
Accountants 122
Attorneys 126
Fractional CFO 127
Family Relationships 128
Shareholder Relationships 129
Vendor Relationships 129
Community/Legislative/Philanthropic Relationships 130
Chapter 7 The Role of Risk: Financial- and Legal-Oriented Risk 131
Commonly Missed Risks 137
Final Thoughts 172
Notes 174
Chapter 8 The Role of Risk: Operational-Related Risks 175
Chapter 9 The Role of Knowledge 241
A Matter of Culture 244
Healthy Knowledge 247
Be Transparent 248
Encourage Two-Way Communication 249
Knowledge and Human Capital 249
Knowledge Measures 252
Notes 253
Chapter 10 Valuation versus Value Creation (GRRK) 255
Software and Rules of Thumb 258
A Personal Aside 260
Collaboration, Cohesion, and Transformation 261
Notes 262
Chapter 11 Putting It All Together-Four Vignettes 263
Vignette One: What the 2009 Financial Crisis Can Teach Us (It's about
Relationships) 265
Vignette Two: The Trees-and-Forest Syndrome 272
Vignette Three: The Path Not Taken 275
Vignette Four: Putting It All Together (Strategy, Human Capital and
Finance) 284
Recommended Reading 313
Index 317