Advice for CEOs

We may be close to a turning point where interest rates will rise and capital availability tightens, due to the recovering economy and the impact of the upcoming mid-term elections.

In the first part of this article, I addressed the current strong environment for middle market M&A and the basic categories of buyers: private equity, strategic acquirers and family offices. How are these deals financed? Middle market company owners and their transaction partners have a range of different types of capital available to facilitate a transaction and create liquidity.

Ask an entrepreneurial CEO where they feel they have under invested in their company to get it to its goals. Many will readily point to “above the line” areas of the company as those they wish they could afford to invest more in: product development, marketing, branding or advertising. One area you tend not to hear mentioned is the finance function, specifically the CFO. Based on my many years as a CEO of global consumer goods companies, I believe that this can be a mistake: optimizing the financial group may be the most overlooked step to value creation in entrepreneurial companies.