The Small Business Black Holes with Alan Pentz Negotiating Success: Steve Wiesner on Buying & Growing Companies
Jul 23, 2024
39:28
Steve Wiesner, owner of Watershed Associates, discusses his transition from private equity to small business ownership. He details Watershed's focus on negotiations training, primarily for procurement and supply chain professionals, and its global reach. Steve shares insights on the acquisition process, the importance of operational experience, and the myths surrounding entrepreneurship through acquisition (ETA).
The conversation explores the current challenges in the private equity industry, including high valuations, rising interest rates, and potential political headwinds. Steve emphasizes the importance of understanding the complexities of running a business before attempting ambitious strategies like roll-ups.
Steve reflects on his experiences in private equity, highlighting the challenges of deal evaluation and internal persuasion. He applies these lessons to his current role, improving his negotiation skills and business acumen.
Throughout the discussion, Steve offers valuable advice for aspiring business owners, emphasizing the importance of operational experience, realistic expectations, and careful consideration of personal guarantees in business loans.
Episode Highlights:
The conversation explores the current challenges in the private equity industry, including high valuations, rising interest rates, and potential political headwinds. Steve emphasizes the importance of understanding the complexities of running a business before attempting ambitious strategies like roll-ups.
Steve reflects on his experiences in private equity, highlighting the challenges of deal evaluation and internal persuasion. He applies these lessons to his current role, improving his negotiation skills and business acumen.
Throughout the discussion, Steve offers valuable advice for aspiring business owners, emphasizing the importance of operational experience, realistic expectations, and careful consideration of personal guarantees in business loans.
Episode Highlights:
- [00:02:59] Global Reach of a Niche Training Business
- [00:09:40] The Myths of Small Business Acquisition
- [00:14:44] The Danger of "Never Quit" Mentality
- [00:22:29] The Case for Buying Smaller Businesses
- [00:30:16] Lessons from Private Equity Experience
- [00:38:27] The Current Crisis in Private Equity
Quotes:
- "We historically have sold workshops, and often there will be batches of workshops that get bought. When you're dealing primarily with Fortune 250 style companies, they often buy in bulk."
- "I think searchers do have such a wonderful opportunity to position themselves as the anti-PE buyer. And yet they call themselves Stone Rock capital or whatever it may be."
- "I have seen companies with five or $10 million of EBD a that are operational basket cases, and so if you're stepping into it thinking that you're buying IBM when you're buying a business doing 3.5, you're not thinking clearly"
- "If you have never bought a business in your life, it is fine, even admirable for you in the back of your head to think Yeah, and I'm gonna do this and then I'll go and I'll buy four more leave Number 23 and four, even any open discussion of number 234 for later on down the road when you've proven you can do one."
- "I think private equity is in a crisis moment right now."
Episode Resources:
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