"If you're thinking about a transaction in three years, then I would say you need to get started now."
That's how AO Co-Founder and Chairman Ed Offterdinger opened his conversation with Wayne Zell on the Blueprint for Wealth podcast, where the two discussed a part of exit planning that owners tend to leave until last: their people.
When a prospective buyer asks an owner to describe their team and the answer is someone in sales, someone in operations, and me, that isn't a team — it's a risk. And it shows up directly in the price a business commands.
Ed and Wayne call this a value gap: the distance between what a company is worth today and what it would be worth with the right people and systems in place. In this conversation, that gap has a job title — a financial leader who has been through a sale before.
Buyers aren't trying to expose a weakness here, either — a leadership gap isn't a dealbreaker. Private equity firms routinely bring in coaches for the leadership teams they acquire, because what's built into a company's people is part of what gets sold.
They also cover:
- The three-year timeline it typically takes to close a leadership gap
- What turnover really costs a business
- The question Ed has closed every interview with for twenty years
Also available on Spotify, Apple Podcasts, and YouTube.
Learn more about AO People Partners and how they help leaders close the value gap before a transaction.