Keith Levy, Operating Partner at Sonoma Brands
Every company must have a strong capital allocation strategy to maximize its potential. Without it, the company may end up missing opportunities and spending money on things that won't help it grow or become more profitable.
In this episode of the M&A Science Podcast, Keith Levy, Operating Partner at Sonoma Brands, shares his experience on successful and unsuccessful capital allocation strategies.
Things you will learn in this episode:
• Strategy vs IRR
• Venture capital vs recapitalization strategy
• Minority vs majority recapitalization
• Evaluating exit strategy
This episode is sponsored by the DealRoom Ready to take your M&A to the next level with software made to manage each stage of the deal process? See how DealRoom can facilitate your next deal at https://dealroom.net
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Episode Bookmarks
00:00 Intro
11:27 Focusing on organic growth
16:37 Post-merger integration execution
25:01 Strategy vs IRR
26:59 Handling projections
28:07 Integration with Mars
36:20 Role of an operating partner
42:07 Big company vs Small company in M&A
43:39 Venture capital vs recapitalization strategy
48:44 Cashing out from an owner’s perspective
50:42 Minority vs majority recapitalization
54:03 Impact of valuations and interest rates on investment decisions
59:07 Timing on investments
1:01:25 Evaluating exit strategy
1:03:46 Advice for practitioners
1:05:41 Craziest thing in M&A
Gerry Williams, Partner at DLA Piper US LLP and a member of their management committee.
Private equity firms are established for the sole purpose of generating substantial financial returns for its investors. And one of the most effective ways of maximizing investment returns is the roll up strategy. This involves buying small-sized businesses in a highly fragmented industry and combining them into a larger platform. The goal is to improve efficiency and be sold later for a higher price.
In this episode of the M&A Science podcast, we will discuss roll up strategy in private equity with Gerry Williams, Partner at DLA Piper US LLP.
Things you will learn this episode:
• Industries susceptible to roll up strategy
• Challenges of executing roll up strategy
• Negotiating the LOI in roll up strategy
• Typical deal structure in roll up strategy
• Employing Earnouts in roll up strategy
This episode is sponsored by FirmRoom
FirmRoom provides 80% cost savings over VDRs that bill by page and delivers a far better user experience to boot. Sign up in under 2 minutes by going to firmroom.com
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Episode Bookmarks
00:00 Intro
04:06 Industries susceptible to roll up strategy
06:22 The trend of roll up strategy in private equity
10:42 Complexities of Roll up strategy
15:52 Challenges of executing roll up strategy
20:32 How to mitigate risks
24:19 Managing multiple roll up businesses
26:49 Negotiating the LOI in roll up strategy
33:00 Breakup fees on private deals
35:57 Typical deal structure in roll up strategy
43:24 Employing Earnouts in roll up strategy
48:07 Unique negotiations during LOI
49:31 Do’s and Don’ts of executing roll up strategy
52:57 Craziest thing in M&A
Tyler Rodewald, VP, M&A at EIS Holdings
In a world where change is the only constant, businesses are continually seeking innovative ways to stay ahead of the curve. One such method that has gained prominence is the corporate diversification strategy, a multifaceted approach that can lead to new growth avenues and enhanced resilience.
In this episode of the M&A Science Podcast, Tyler Rodewald, VP, M&A at EIS Holdings, discusses corporate diversification through M&A.
Things you will learn:
• Corporate diversification strategy
• Drivers of corporate diversification
• People involved in corporate diversification
• Projecting revenue synergies
• Closing deals with competition
Andrey Galiuk, Vice President of Corporate Development and Investor Relations
Before doing M&A, it is crucial for acquirers to target the right business, in the right market. Otherwise, it could potentially be a costly mistake that would waste the company’s time and money.
In this episode of the M&A Science Podcast, Andrey Galiuk, Vice President of Corporate Development and Investor Relations, shares his expertise on how to perform strategic due diligence in M&A.
Things you will learn:
• What is strategic due diligence
• How to perform strategic due diligence in M&A
• Entering the right market
• Finding the right target company
• Biggest challenge when performing strategic diligence
George Kellerman, VP, Head of Investments & Acquisitions at Woven by Toyota and Alexander Baum, Corporate Development Lead at Woven by Toyota
In the ever-evolving world of business, staying ahead isn't just about what a company does today, but how it prepares for tomorrow. This is where a venture capital arm comes into play. It is a specialized division within a larger company that focuses on investing in emerging startups and innovative projects.
In this episode of the M&A Science Podcast, George Kellerman, VP, Head of Investments & Acquisitions at Woven by Toyota, and Alexander Baum, Corporate Development Lead at Woven by Toyota, share their experience on how to stand up a venture capital arm.
Things you will learn:
• How did Woven by Toyota got started
• Successfully start a venture capital arm
• Leadership in managing people
• Biggest Lessons Learned
• Dealing with cultural difference
Camilo Franco, Director, M&A Integration and Operations at Jamf
There is an intimate tie between M&A strategy and corporate strategy. To be truly effective, acquisitions must directly support the overarching goal of the company. But beyond that, there needs to be a strategic alignment with everyone involved.
In this episode of the M&A Science Podcast, Camilo Franco, Director, M&A Integration and Operations at Jamf, shares their secrets on how to achieve strategic alignment from top to bottom.
Things you will learn:
• How to achieve strategic alignment
• Strategies for effectively communicating M&A plans
• Tools used to maintain alignment
• Connecting diligence and Integration
• Advice for integration practitioners
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This episode is brought to you by the M&A Science Spring Summit 2024 happening on April 10th at 10AM ET. It's your chance to join leading M&A experts as they share innovative and the latest trends from their own deals. Save your spot here.
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Episode Bookmarks
00:00 Intro
08:45 Definition of strategic alignment
10:31 How to achieve strategic alignment
12:51 Relaying M&A strategy against corporate strategy
13:54 Getting buy-in from team members
15:37 Overcoming anti-M&A culture
18:44 Strategies for effectively communicating M&A plans
21:21 Alignment with the integration team
23:51 Formulating the integration thesis
26:37 Role of steering committee
28:04 Communicating decisions with the broader organization
29:30 Managing integration without IMO
32:09 Ensuring company readiness for integration
34:11 Gauging M&A readiness
36:06 Side effects of burnout people
37:25 Defining the end of integration
39:30 Tools used to maintain alignment
43:32 Agile M&A
44:46 Connecting diligence and integration
48:13 Using integration templates
50:36 Advice for integration p
Ken Bond, Head of Corporate Development at Cetera Financial Group.
Most of the biggest M&A failures of all time are caused by culture clashes. Both companies cannot simply co-exist with each other, and instead of creating more value, they destroyed both of their businesses. This is why cultural due diligence is crucial in M&A.
In this episode of the M&A Science Podcast, Ken Bond, Head of Corporate Development at Cetera Financial Group, shares his expertise on how to perform cultural due diligence to better understand the target company.
Things you will learn:
• The person responsible for cultural due diligence
• Executing cultural due diligence
• Using Playbooks
• Successful partnership between Corporate Development and Integration
• Advice for practitioners
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This episode is sponsored by the DealRoom
Ready to take your M&A to the next level with software made to manage each stage of the deal process? See how DealRoom can facilitate your next deal at www.dealroom.net.
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Episode Bookmarks
00:00 Intro
05:11 Person responsible for cultural due diligence
05:54 Importance of cultural due diligence
08:08 Executing cultural due diligence
10:29 Killing the deal due to cultural conflict
14:54 Using Playbooks
17:31 Cultural due diligence during early conversations
20:12 Understanding how the target company makes decisions
22:40 Things to look for during due diligence
25:09 Using questionnaires for cultural due diligence
27:08 Bilateral deal vs. Auction process
30:10 Hardest part of cultural due diligence
32:27 Successful partnership between Corporate Development and Integration
35:33 Subculture due diligence
37:07 Advice for practitioners
38:31 Craziest thing in M&A
Baljit Singh, Former SVP, Global Head of Corporate Development at Nielsen Ventures
Engaging in M&A activities just for the sake of doing them is one of the biggest reasons for failed deals. Without a well-defined purpose, these transactions can distract the business and waste massive amounts of resources.
In this episode of the M&A Science Podcast, Baljit Singh, Former SVP, Global Head of Corporate Development at Nielsen Ventures, discusses the importance of strategic alignment between M&A and corporate strategy.
Things you will learn:
• Corporate strategy vs M&A strategy
• Getting the strategy right
• Capital allocation
• Measuring business unit’s success
• Deal structure to preserve cash
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This episode is sponsored by FirmRoom.
FirmRoom provides 80% cost savings over VDRs that bill by page and delivers a far better user experience to boot. Sign up in under 2 minutes by going to firmroom.com
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Episode Bookmarks
00:00 Intro
05:10 Corporate strategy vs M&A strategy
09:25 Getting the strategy right
11:17 Best ways to pitch deals
13:09 Pillars of corporate strategy
15:50 Capital allocation
21:06 Measuring business unit’s success
24:52 Holding business units accountable
27:20 Why take a public company private
33:51 Steps to take a public company to private
38:11 Real life examples
48:29 Deal structure to preserve cash
54:45 Dealing with reluctant seller
59:30 Craziest thing in M&A
Problems don’t usually surface at the early stages because it's the honeymoon phase. Both the buyer and the seller would like to see the deal happen, so they work together to build momentum. And often that means postponing dealing with some of the more difficult and contentious issues. However, these M&A challenges are inevitable and will arise as the deal progresses.
In this episode of the M&A Science Podcast, Douglas Barnard, former Executive Vice President, Corporate Development and Legal Advisor at CF Industries, discusses effective strategies to overcome M&A challenges.
Things you will learn:
• Mindset to prepare for M&A
• Overcoming M&A Challenges Between Signing and Closing
• Mitigating Post-Merger Integration Risks
• Biggest Challenges in M&A
• Advice for First-time Acquirers
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This episode is sponsored by FirmRoom.
FirmRoom provides 80% cost savings over VDRs that bill by page and delivers a far better user experience to boot. Sign up in under 2 minutes by going to www.firmroom.com.
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Episode Timestamps
00:00 Intro
05:26 Mindset to prepare for M&A
10:26 Strategic Negotiation Tactics
13:03 Having a Foundation of Trust and Honesty
17:31 Assessing Buyer Transparency in Deal Negotiations
20:17 Mastering Valuation and Identifying Synergies
22:43 Identifying and Overcoming Obstacles in the M&A Process
24:40 Uncovering Surprises in Due Diligence
28:53 Utilizing a Private Investigator (PI) in a Deal
29:57 Navigating Complex Negotiation Stages
33:54 Zero-Sum Scenarios in M&A Auctions
35:51 Valuation and Auction Bidding Strategies
37:57 Overcoming M&A Challenges Between Signing and Closing
41:29 Mitigating Post-Merger Integration Risks
46:16 Biggest Challenges in M&A
50:24 Advice for First-time Acquirers
52:51 Craziest thing in M&A
Allan Marks, Global Project, Energy & Infrastructure Partner at Milbank
M&A valuation isn’t just about looking at the numbers. There are a lot of different factors that affect and contribute to the volatility of the M&A market.
In this episode of the M&A Science Podcast, Allan Marks, Global Project, Energy & Infrastructure Partner at Milbank, discusses how business cycles affect M&A valuation.
Things you will learn:
• What is a business cycle
• What is a credit cycle
• How business cycle impact M&A valuation
• Common Mistake during M&A valuation
• Importance of culture in M&A
This episode is sponsored by the DealRoom
Ready to take your M&A to the next level with software made to manage each stage of the deal process? See how DealRoom can facilitate your next deal at dealroom.net.
Episode Timestamps00:00 Intro
11:00 What is a business cycle
12:41 What is a credit cycle
16:59 Cycle’s impact on energy sector
19:09 How business cycle impact M&A valuation
22:36 Industries most affected by the cycles
26:43 M&A valuation for first-timers
31:47 Importance of culture in M&A
34:23 When to pull of a deal
37:37 Example of failed deals
41:59 Example of good deals
45:43 Common Mistake during M&A valuation
46:43 M&A function maturity
48:02 Other early M&A considerations
49:15 Craziest thing in M&A
When executing M&A, having a structured approach to validating the acquisition plan is crucial. The worst thing any acquirer can do is to buy a business that doesn’t bring value to the parent company.
In this episode of the M&A Science Podcast, Adam Harris, CEO of Cloudbeds, shares the meticulous 6-step process his company uses to validate their acquisition plan.
Things you will learn:
• Surveying Customers
• Industry Trend Analysis
• Partner vs Build Analysis
• Formulating the strategic rationale
• In-depth Company Analysis and Product Demos
• Drafting a detailed memo
This episode is sponsored by the DealRoom
Ready to take your M&A to the next level with software made to manage each stage of the deal process? See how DealRoom can facilitate your next deal at https://www.dealroom.net
Episode Bookmarks00:00 Intro
08:45 Approaching M&A
18:20 Surveying Customers
23:47 Industry Trend Analysis
28:13 Partner vs Build Analysis
34:12 Formulating the strategic rationale
36:50 In-depth Company Analysis and Product Demos
41:18 Drafting a detailed memo
44:15 Pitching M&A to the board
44:54 Craziest thing in M&A
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