Perception Is Everything
We were called in one day to look at a company that was in the specialized trucking business. Milt had forty trucks and substantial customers. He was thirty-seven or thirty-eight years old and looked like he was fifty. And as I got to know him, I found out that he worked roughly eighteen hours a day, six and a half days a week.
Milt said to me, “I’ve just gotta get out of this business. Many times I sleep in the truck and get up in the morning and just keep on going.”
I visited his business and was impressed with what I saw.
Many of the details we needed – financial information, a list of all the equipment, details about the contracts – were there.
Milt called me one morning.
“Doug, I’ve got an offer coming in. I’m going to need an accountant and a lawyer and you. I assume you’ll help me with this offer.”
I arranged for an accountant and a lawyer and the three of us went to meet with Milt. Then Milt and I went to meet the buyer. The buyer made an opening offer of $8 million.
Milt was about to say yes but I gave him a nudge with my elbow and said, “We’ll get back to you in a couple of days, if that’s okay with you.”
Once Milt and I were back in the car I said, “Milt, you’re not telling me everything I need to know.”
“What do you mean?”
“Our valuator just said $4 million to $4.5 million. That buyer knows something about this business that I don’t know and you are going to tell me everything I need to know.”
So we went back to my office. We put him on the grill for twelve hours, from eleven in the morning to eleven at night We went back up to his place at eight the next morning with a full team of people and we were there until ten that night. Yet we still couldn’t find anything indicating that his business was worth $8 million.
I told my team this called for drastic action. “What’s that?” they asked.
“The LL program,” I replied. “Yes, the Liquid Lunch.”
So I called the buyer and asked him to meet me at the martini bar about one o’clock to grab a sandwich.
I went to the martini bar and I was deliberately twenty minutes late. I had called and said, “I’m tied up and I’m going to be a few minutes late.” I wanted him to be hungry.
So we went in and ordered double martinis. We had a small sandwich and then another double martini. And then a third double martini. We left at about 3:30.
I called taxis for the two of us because neither of us was in any shape to drive. A little while later I called the client.
“Milt, from this point forward until we finish negotiating, your plant is quarantined. Nobody is allowed in your building without my express written permission. That includes suppliers, customers, government inspectors, repairmen, electricians – nobody comes into that plant.”
“This buyer thinks you’ve got a secret process in that plant and he’s prepared to pay a lot more than $8 million. At the same time, he’s about to take his company public and he wants that plant in the corral when he goes public because he thinks he’ll make a killing on the public market.”
Four weeks later we closed the deal for $13.5 million.
Selling your business doesn’t happen every day.
It’s a once-in-a-lifetime event.
When you make that decision to sell, then you have the power. Whereas if someone else makes that decision for you …