5 Areas That May Need Restructuring

Does your company need a restructuring? Before you answer, “No, we don’t need a restructuring”, let’s think about this.  What is Restructuring?  Yes, it can be a bankruptcy restructuring, both financially and operationally.  But truly ALL BUSINESSES at one point or another need restructuring, or if you prefer, process refinement. Think of a high growth company.  Now at $25 million in revenue, can they use the same business processes that they used as a $5 million company?  Or like the lab business we just finished, it was a $30 million company and now with reimbursement changes it is a $12 million company.  Can they run the business the same way at $12 million as they did at $30 million? Of course not. We suggest that there are at least 5 areas that management needs to consider restructuring. 1. Revenue Cycle Management The process of completing an order, billing and then collecting the receivable will absolutely change over time.  Often different systems come together to produce a bill.  In the lab business, for instance, there is a lab information system that receives information from the lab equipment and transmits certain data to the billing company.  In a multi-location retailer or restaurant, …

Operating Plan to Turn Around Lab Company

Our latest assignment is to provide strategic consulting services to a lab company doing business nationwide.  The lab industry has changed drastically in recent years, resulting in substantially lower reimbursements and increased regulatory pressures. These industry circumstances has caused this lab company to shrink down to about a $12 million run rate, running at about breakeven on an EBITDA basis. The CEO retained us to examine his operations and financials.  Employees knew that I’d been retained to help the CEO and an am independent third-party advisor.  We have spent the last several weeks talking and drilling down to the fundamentals of the business with all business department heads, assisting in a potential acquisition and developing an operating plan to improve operations and profitability. This industry reminds me of the home health business back in 1998-2000.  Reimbursement changes from Medicare caused about 1/3 of all home health businesses to close.  The other 2/3rds held on but were badly damaged. Today the lab business is dominated by Lab Corp & Quest.  Most smaller  labs have closed, or been acquired, or are struggling to find significance within this huge industry. Mr. Villwock is working with this company’s CEO to become one of the …

Are You a Lonely CEO?

No, I’m not asking for a date.  But it’s a fact … being a CEO can be a very lonely place to be. Most CEO’s think it’s all up to them.  Live.  Die.  On their shoulders.  All on your shoulders. It doesn’t have to be that way. I partner with CEOs to help them see their company in a new light — to find growth avenues they haven’t considered — to be a sounding board for good ideas, and for bad — to help transform the financial operations — to create a professional financial and operational presentation which attracts banks and investors. Check out my video on how working with Medway Air Ambulance allowed that company’s value to go from $8 million to $21 million in just two years.  Founder/CEO sold 80% of the business and ended up with over 5x the after tax cash as he would have if had sold the business at the lower valuation. I’m looking to partner with the CEO.  If you would like to discuss your company, either email me at Jeff@JeffVillwock.com, or give me a call at (678) 540-1300×1.  

How to Raise Capital

We have just released our new 51 page e-book to help CEOs to understand exactly how to raise capital in today’s world. The book chapter headings pretty much tell the story about what’s included: The Process of Raising Capital Create the Financial Plan Create the Operating Plan Determine the Amount of Capital Needed Determine the Terms of the Capital Determine Type of Offering Write the PPM Subscription Documents Escrow Agent Your Investing Audience Create your Investor Presentation Create your Marketing Plan Execute & Close the Offering This book is a gift from us — you can get it here.  We are also making available a complementary One-Hour Consulting session for CEOs who want to raise capital. Why would I do this? We offer consulting services to businesses like yours and I know that some percentage of the executives we help with our Special Report and One-Hour Consulting session will end up as our clients. We want to be clear — We’re not trying to sell you anything. On the contrary, we only work with clients who are qualified and ask us to help.  And if we help you, then you may want to be one of our clients. But obviously …

Growth Equity – Is Crowdfunding the Answer?

Crowdfunding is gaining a lot of press.  The SEC has finally come out with proposed rules and regulations to allow companies to raise growth equity through crowdfunding.  But is that the answer for most entrepreneurs in search of capital? It’s very important to distinguish between “investment crowdfunding” and “direct investor solicitation”.   Most people think of Kickstarter or similar web sites when thinking of “crowdfunding”.  On these sites, an entrepreneur may raise some capital as donations, giving investors back product or other promotions, but not equity in the company.  Generally the amounts raised are small. “Investment crowdfunding” rules were just issued by the SEC in October and won’t be effective until May 2016.  In investment crowdfunding, companies will be able to raise up to $1 million per year, and unaccredited as well as accredited investors can participate. While that’s a move forward and will surely seed a lot of companies, most existing companies that have proven concepts need more than $1 million in $5,000 or $10,000 increments. The JOBS Act also opened the door for “direct investor solicitation”.   Before the law changed, companies could not “solicit” for investment.  As an example, a company could not run an ad in the …

Fed to Investors: Economy So Bad, We Can’t Raise Rates 0.25%

When the Fed announced that rates will continue to be Zero, the stock market soared — for about an hour and then plunged.  Today down another 200+points. Why?  Real simple — The Fed actually said that the world’s economy is so fragile that a meaningless rate increase of 0.25% was potentially a real problem.  And I’ll give them credit for being right about this — had the Fed raised rates, the Dow probably would have been down 500 points instantaneously. Someone sent me this picture a couple of days back — and if a picture is worth 1,000 words, this one is probably what weighted on the Fed.                               This is downright depressing.  In the last 7 years, food stamp use has soared, as has the federal debt, the amount of money printed, student loans (which are future losses) and health insurance costs.  Obamacare reduces costs??  Really – don’t think so. What is down?  The workers share of the US economy (blame the “rich” guys – Nope – blame Washington & the President’s policies), Median family income, home ownership and most important of all, labor force …