#111 Making Your Business Attractive to Investors - Business Bytes

In this week’s Business Bytes, host Garry Kelly talks Hutton Henry, founder of Beyond M&A, about the pivotal role of people in business success. Hutton explains Beyond M&A's function in evaluating companies for investors, emphasising the importance of having the right personnel in place. They discuss team dynamics, the impact of stress on performance, and challenges in preparing businesses for sale. Hutton also highlights market trends, business valuation, and the effects of recent changes like COVID-19. The episode underscores the necessity of proper documentation and operational awareness to maximise a business's value during an exit strategy.   For more information visit https://linktr.ee/huttonhenry   - Watch the VIDEO of this episode by joining our tribe today at www.GarryTalks.com -   Please follow Garry Talks on Instagram, LinkedIn and TikTok.  Please follow GKMedia.ie on Twitter, Instagram, Facebook, LinkedIn and TikTok.  Most importantly – please subscribe to this Podcast.   Timestamps by PodSqueezeHere are the extracted timestamps and their corresponding titles: Introduction to the Podcast (00:00:00) The podcast is introduced as part of the GK Media network. Guest Introduction (00:00:17) Garry welcomes Hutton Henry, founder of Beyond M&A, to the podcast. Overview of Beyond (00:00:32) Hutton explains Beyond M&A's role in assessing companies for investors. Importance of People in Business (00:01:05) Discussion on the significance of having the right people in the right roles. People First Philosophy (00:01:42) Hutton emphasises the value of people in business and the need for sensitivity in evaluations. Challenges in Team Dynamics (00:02:23) Exploration of issues arising from long-term team dynamics and unresolved personnel problems. Impact on Business Sale (00:03:08) Discussion on how unsuitable personnel can complicate business sales. Use of Technology in Assessments (00:04:20) Hutton describes the technology used to assess team dynamics and stress responses. Identifying Team Cloning (00:06:23) The issue of team cloning is discussed, emphasising the need for diverse management styles. Stress as a Positive Force (00:08:25) Hutton explains how stress can foster dynamism and creativity in teams. Advice for Business Exits (00:09:49) Hutton shares insights on preparing a business for sale and the importance of documentation. Common Issues in Exiting Businesses (00:10:08) He highlights documentation lapses as a frequent issue for businesses preparing to exit. Market Valuation of Businesses (00:13:19) Discussion on the average selling prices of small businesses and the factors affecting valuation. Emerging Business Trends (00:15:46) Hutton identifies rising industries and sectors attracting investor interest. Post-COVID Business Landscape (00:17:42) Discussion on how COVID-19 has shifted investor focus towards profitability over growth. Challenges for New Startups (00:18:32) Garry and Hutton discuss the difficulties faced by new businesses in sustaining trends post-COVID. Class System in Software Development (00:19:35) Hutton mentions the emergence of a class system in the software industry due to AI advancements. The impact of recent events on business (00:19:38) Discussion on how COVID, Brexit, and other events have affected the business landscape in the UK. The significance of the 2024 budget (00:20:07) Hutton highlights the budget's surprising impact on the investment market, more than COVID itself. Elon Musk's influence on company operations (00:20:42) Exploration of how Musk's decisions at Twitter affected hiring practices across various companies. Transitioning from cloud to in-house systems (00:22:44) Discussion on businesses moving away from cloud services to reduce costs and regain control. Documenting business decisions (00:25:23) Importance of keeping thorough documentation for effective governance and accountability in business. The three C's of business assessment (00:26:17) Hutton outlines the critical factors of communication, consistency, and care in evaluating businesses. Expectations for communication practices (00:27:44) Insights on what evidence of effective communication looks like within a business. Preparing for investment (00:28:57) Advice on internal preparations and timelines for businesses seeking investors. The abundance of investment capital (00:29:46) Discussion on the availability of funds versus the lack of quality businesses for investment. Importance of service quality and retention (00:30:53) Emphasis on maintaining high service standards and customer retention as companies mature. Target audience for their services (00:30:58) Clarification on who seeks their expertise: primarily investors and sometimes founders. Maximising business value (00:31:51) Hutton explains the common issues they address to help businesses enhance their value.