#211 - What Buyers REALLY Look For When Acquiring a Business | Muriel Touati | The Necessary Entrepreneur

0:00 We talked a little bit before the podcast, that w we didn't you didn't have the exact number of business owners that are gonna retire over the next decade. But I I think it's it's tens of thousands and it it's something equal to like a few trillion dollars. They're either going to be sold or they're just gonna shut down because they're retiring, right? This is coming. It's a huge opportunity for people to acquire businesses right now.

0:44 All right, y'all. Hey, welcome back for another awesome episode of The Necessary Entrepreneur. I'm pumped to have the conversation today. it's around businesses buying and selling and the experiences of that and also from a person who's been an entrepreneur for going on a decade. So what we know is most founders assume a profitable business is automatically a valuable one. But when it comes time to sell, buyers are looking for something very different. So today's guest works with entrepreneurs to identify the operational issues, founder dependency, and structural gaps that can limit a company's value and helps them build businesses that are actually transferable. So Muriel Touati I came really close in the last name.

1:26 She sh we're gonna go by Muriel after this, but just an awesome French name. But she's the founder and CEO of Exit 3D Studio. Where she advises founder led service businesses on increasing valuation and preparing for successful exits. So today we're going to talk about what buyers actually look for, why so many businesses struggle to sell, and how founders can create companies that operate beyond themselves. Muriel, welcome to the necessary entrepreneur. Thank you, Mark. Hopefully that intro gave a good representation of your business and and what you're really focused on going into your fifth year of of exit 3 D studio. Yes, absolutely. You described exactly what I'm doing and what we're gonna talk about today. Yes. So what What brought you, let's start here with me.

2:13 What brought you from France five years ago? So what brought you and then 'cause I think what that'll do is you're an entrepreneur in France, I think that'll weed into even more credibility and an idea on the uniqueness that you might bring to this environment and this space that you're in now too. Yes, absolutely. It's very related, actually. yeah, so I moved to New York in twenty twenty one. I lived here in the past on different visa, but this time I have a green card so that allowed me to stay longer and because I just like the city, I still had friends, I decided to to come to New York. Where are you located?

2:54 I don't even know. Where I We're we're here in the Midwest. We're in we're in Cincinnati. So Okay. Yeah, so just just a two hour flight from New York City. so when you came up show a green card means ten years, right? Yes, but it's constantly renewable. So you're stuck with us for good now, huh? Yes, looks like it. So why so where you were already an entrepreneur in France? Yes, I was since twenty seventeen. So why come to a new country? Because I think about if I went to I'm just gonna you know, we we think about France and we think Paris, but there's Marseille, there's all these other cool cities that none of us talk about. But if I were to go to France or London or Madrid or Lisbon, I think it would be really hard for me to become an entrepreneur there for customers there, but you're making this seems to be this seamless transition.

3:47 So can you take us through these first five years and Why you're making it feel seamless and why it seems like it's comfortable to you. thank you. I didn't know I was giving this perception. But so I already had my business in France online. It was you know digital consulting like LinkedIn consulting for clients and and and as we were discussing earlier, like during the COVID period I was creating an online course so this was something I could transfer here. And all this time, even now, I still have my French client that I can coach coach on Zoom, you know, like once a week, and they have access to my program.

4:34 So this was yeah, seamless because I didn't have to change my offer. I didn't have to change my target audience. I w I just moved from France to New York. And didn't change the business at all. You were gonna buy a business though, right? Like that was the beginning So this is yeah, this is what I have been thinking about since last year. So in twenty twenty five I'm I realized that I didn't change anything from when I was in France. And I said, okay, so I'm missing all the good opportunity here. I'm meeting people and I I cannot do anything. So first of all I thought, maybe it's gonna be too hard to start a new business.

5:20 So maybe I should buy one. I heard it could be easier. I will be buying a cash flow. It will be easy. So I've been learning all about you know business acquisition. I joined a program, I am part of a buying community and and it's been great. I've signed I don't know, one hundred NDA I've submitted a lot of letter of intent. I even have an offer accepted and I was like very close to buy a business. until you know I realized that they were all having structural issues that was too risky for a buyer, you know, buyer operator I would say like me.

6:06 And as a matter of fact, like most buyers like me, sometimes they are employee even and they want to buy a business to become an entrepreneur. We we are all bumping into the same issues. So this is how I decided to create, you know, pivot a bit my French business into Exit 3D studio. What when you said an NDA for all those people out here who haven't done it yet, what is an NDA? It's a non-disclosure agreement. It's business broker, they make you sign that to ensure that you will not bypass them, that you will not go directly to the to the business owner because they want to get their commission.

6:51 they also disclose different things that for example they are not checking everything about the business when they put it into the market. And and this explained different things after and why actually like seventy to eighty percent of business that go for sale actually never sell. When you It drives from the NDA actually, why? Yeah. There you go. So an NDA, what it does is it's also showing you some things about the business that if they're gonna open up a little bit of information about operationally revenue, if they're gonna show you some of that, you're agreeing that you're not gonna share that with anyone else. Soutnie yeah And yeah. And it and if you and if you do, there's penalties for that.

7:35 Yes, absolutely. Yes. And then after that, you move through this process of an NDA. If you think you like the business and your initial high ten thousand feet evaluation of it, then you can go to an LOI, right? And then an LOI go into details about what that is a little bit because we're probably talking to some people here that they've been entrepreneurs in the past where they've built their businesses up. They haven't ever sold one, or they're also, maybe like you were, thinking about buying one. So you go from an NDA to then an LOI, which is Yes, so if you like the business, what they showed you, you analyze a bit the financial and you want to make an offer, you submit a letter of intent.

8:17 So an LOI. I usually you send an email, post a letter to make your offer, explain roughly what I mean not roughly, it can be almost as long as a purchase agreement if you want to where you put all your condition, your the old bag, the earnout, all the seller note, you you can be as detailed as that. And actually it's I think it's recommended because it's at least they like it or they they agree or they don't agree and you don't waste weeks in due diligence. You know? Yeah. an O O I it's not you're not bound. Either party isn't. It's just saying I have this is a letter where I intend to submit an offer with these parameters.

9:03 And if you're somewhat okay with them, then I'll move to submitting an offer and try to go to a binding contract, correct? It is actually an offer. You're making an offer but it's a non binding contract. Though you will have some brokers because that happened to me, that will be that they will ask you to sign their own letter of intent and it will be binding. So like always read those documents because yeah, you can can get into problems, you know, you don't want to Until you you do your due diligence you should not be you should not be into a binding contract because what if you find some problems and you decide you don't want to buy the business anymore?

9:49 What if it has been not represented, you know, correctly? When you when you were gonna acquire your business, at what stage did you decide to back out? So at what stage of the purchase process and then why? What happened? What made you change your mind? Yeah, so it was during the due diligence. I have been you know running the financial like like in a content really into detail looking the the revenue by client. you actually when you do a due diligence you do like a financial due diligence, you do an operational due diligence, digital due diligence, all those sort of different due diligence.

10:35 The one I was the most comfortable with was definitely the digital due diligence. This is what I've done first. I realized first of all, okay, the business has no traffic, like 300 visits a month. That's so they don't really generate lead from that. I was reading also everything they provided in the in the data room to see okay how do they get a client. There was some thing also there were announcing. Beh they have you know like past August they had about 35 clients. But we were in December they still have 35 clients, but they say they are growing every month getting new clients.

11:17 So this was a problem and something I needed to resolve because when you ask the broker they still tell you that everything is perfect, but when you run the financial you look and the I had to ask for that. They didn't want to give it to me. The the breakdown of revenue per client for the past year. And once I've been running that, I have been able to see that every three months when the contract was ending, it was an initial three month contract and then ever auto renewal and a monthly auto renewal, so cancel anytime. Actually all client getting working with them, most of them, they were leaving after three months.

12:02 So they were able to get new clients every month, but they were leaving after three months. And just that realization made me step away. I said, okay, so this is it's not a recurring revenue, it's a rollover sort of roll out, sorry, my English you know, type of revenue. and it can disappear at any time. Also it was like a LinkedIn lead generation agency and I I was able to see also their practice and I said okay this can break at any time. Like I don't feel comfortable also taking this. They are pushing the the machine a bit too hard.

12:44 Plus they were using the founder LinkedIn profile to generate leads. Which was not an transferable asset, of course. Yeah. You know. Did you find yourself were you still interested in purchasing it at a lower valuation or not at all? Well I was no I was not but I I explained everything. My offer was at three point seven million. That is what they wanted. And when I ran all my number my analy I think the agency was worth only six hundred thousand. But at this point I say yeah no, I I'm walking away.

13:26 Yeah. Yeah. What was their response to that? Did they even respond or they just They did but I sent an email like long like this with all the reason why and even suggesting like you should be a bit more transparent, you know, like t with the buyers. I think they thought it's so helpful, like helpful information, just two lines, you know. Plus I never spoke with the the the owner either. It was all through the broker. Yeah, all through the broker, yes. Hmm. So from that experience that caused you to start your business, correct? Exactly. I say I you know, I understood since I was bumping into the same issues all the time and part of the community I am in, I I can read all the struggle they have.

14:16 I said, Okay, this is making sense. And you know, this i and with my previous experience in digital marketing, I say, you know what, I can help with customer concentration. I mean this is what we do. in digital marketing, we can help with that and the quality of the revenue, the growth, and the funder dependency as well. There's yeah different things we can be doing. Yeah. Do you find that is the founder dependency? It means the revenue of the business is dependent on the founder staying there, being there, maintaining those relationships. do you find that the most significant problem or just one of the significant problems in achieving the valuation that sellers want?

15:01 What's the most significant problem that you're seeing that you just can't get to the valuation that they feel the business is worth? The so the the most the the first thing that I see we see it on the on the sim that we receive. Most of the time I think it's the customer concentration that is the biggest issue, then the project based work and then instead of the recurring revenue and then the funder dependent, the funder who was all the relationship with the customers for example. no no digital presence, like no sign of regeneration online.

15:44 That means everything is referral, everything is passing by the funder. This is a red flag as well. And And also just a funder who's managing everything, who's where there is no other decision maker in the business. This is also an issue. Yeah. What do you like to see now evaluating businesses from the buyer side? So whether it's you doing acquisitions, whether it's helping people acquire, if it's sellers, what do you like to see from a digital perspective? The the digital presence of the business, the level that they're at. What are what are you looking for through the eyes of a buyer of these businesses? What level of digital engagement or digital operation, what are you looking for? It seems that in two thousand twenty six that it's not just AI driven, but You need to make sure that you have platforms dialed in from an efficiency standpoint, from an operation standpoint, so things can compound so it can scale.

16:42 What are you looking at digitally for a business? Yeah, so I think myself as you know as expert in digital marketing, I could acquire, you know, like a business with you know a very like w who doesn't have a good digital presence. It will be an upside for me because I will rebuild the website, I will create the social media presence, but also I will not buy the business at a high valuation. you know, I will discount it automatically. But someone who comes from another sector, and I think most buyer to pay a premium, they would expect traffic on the website.

17:27 And this is easy to to find, you know, like when we do a digital due diligence, we just go on some tools and we see the traffic that they have. And if it's a branded traffic or if it's unreal keywords. So we look at that. The traffic, I think the the most important. Then when you we look at the structure of the of the website, is there any sort of funnels that could be working? Could they be generating leads from their website? Does it work something? And then the social media presence also because you know, it's the perception of the the perception from, you know, potential customers.

18:13 Is Yeah. it outdated, in existence? Yeah. So we talked about funnels and I think to break funnels down, really what it is, it's what's your digital approach to client and business acquisition, right? It's like how are you taking those leads, putting them in the top of the funnel and feeding down through your algorithm so that you can turn them into sales, buying whatever your service or product is, right? Yes, yes. So with with the funnel perspective, do you what's your approach to building a funnel? You were in the digital space. You help service businesses. What have you seen this happening with funnels? It seems like a lot of stuff's moving to a lot of automated things. It's easier to build these versus go and pay, you know, very expensive experts.

18:57 What have you seen happening with funnels over the past six to twelve to eighteen months? Yeah, since I've moved a lot into AI for sure. And there are different ways of building a funnel. You know, you can have a a funnel with ad, a funnel with a freebie, you can have a direct call funnel. There is d more or less sophisticated funnel, but depending on what you are selling and if there is a team on the other side that can take calls or not. yeah. Yeah. If you were doing it all over again, if you were the Muriel who said, I think I'm gonna buy a business, what would you how would you do it now versus your approach back then?

19:41 So you were evaluating the business, you signed NDAs, you went to an LOI, you're doing due diligence through reflection, which should lead to your experience to advise people and help them do this, what would you do differently now with the approach versus the Murial of a year or two ago? Will say it depends on the business. Like the business I'm building right now, Exit 3D Studio, the funnel is gonna start with the book that I have been writing and that will be out on Amazon end of July. So that will be my first, you know, the beginning of my funnel. Then you know you can go into my my website, get you know, the the freebie, the scorecard, the call etc etc but if it was let's say like a plumbing business what I will be doing I think I will be for sure using the Google My Business and making sure it is perfect we have review from all clients We have a solid website that is recommended locally even on AI search, maybe running some ads if needed.

20:56 But I will try to move from the referral only. Referral is a bonus, it's nice to have, but if we only count on that Though I'm saying that I'm pretty sure many plumbing business have already a lot of business, you know, from referral, but just mentioning. Yeah. The yeah, I mean it's it's interesting. So tell us about your book. What obviously the title, but what what's the what's the title? What's the purpose? What's it gonna do for us if it's the funnel to say, Hey, Muro wrote this book, we read it, it makes us wanna work with her. Tell us tell us the depth and and and what's happening in it and why you're writing it.

21:41 Yes, so it's called the valuation gap, what biases then seller miss. And I in this book I explain what I found and what needs to be corrected and why for a higher valuation. I think it's valuable for business owners who are thinking about exiting their business at some point. But why not also potential buyers so they don't get they don't waste too much time on businesses that have this problem? Or at least they know they should discount the the value the the multiple.

22:21 The d do you think that was it a good choice for you to work through a business broker or do you think there was a different source that people should go through to go directly to a business owner? Is there better way than just working through a business broker now to acquire and buy a business? I mean, most of the time, you know, to find a business for sale you're gonna go on different websites, like Peace by Sell and others, and all businesses are advertised by business brokers. So those are partner for us. Like most of ninety percent of the time you will work with the business brokers and and that's okay. I mean they facilitate, they have the financial ready and you know, while if you go directly with a potential, you know, seller, you might not get that.

23:13 But sometimes you can get some really good deal. I I just I'm thinking about what. So let me tell you. It didn't go through, unfortunately, but I was doing my off market search so to enter directly in contact with some business owner. At this time I was looking for a marketing agency. And I ended up meeting with one a marketing agency in New York who went for lunch. We had a good time and and he was telling me like if you're interested, I have those other business, I even give it to you for free. really? Like I don't even have to get a loan or anything.

23:56 And he we're saying yes. But he had those conditions, like he would want to stay in and then I start to dig and also I said, but I would like to see the financial, you know, at least show me the financial. I want to see if the business is profitable. And then I never got the financial because so this you know, you cannot even get a business for free if you don't get the financial. I mean that's dangerous. Yeah. So what's the benefit of buying a business versus starting it? Because you've looked at both. You've looked at buying and now you started yours. Yeah. Yeah. So the benefit of buying a business if everything goes well is you're buying a cash flow. So maybe you're you get a loan for like a million dollars, but if every month you get getting your fifty thousand or eighty thousand and the loan is I don't know, t I I'm not making accurate calculation here, but like thirty thousand you still get your fifty Okay, so you're buying that. This is what you're getting directly from day one.

25:04 while when you start your business, okay you don't have a loan, you're debt free, but it can take more time to take off before you get to your fifty thousand or one hundred K a month. Yeah. And learn all the hard lessons of starting a business. Yes. Why are you so yeah, yeah, why why are you so you're passionate, you're writing a book, you started a business, you almost bought a business. What where does your your fire and your excitement and your your energy for being an entrepreneur, where's that come from? I think I like the freedom like most of us the freedom of being where we want to be, to take the decision we want to take, to not have to stay in a box, decide to do something and change it if we want just creating a lot and and especially when i I have You know, for a long time I was doing everything myself.

26:06 I think it was limiting me. Now I am more like outsourcing a lot of things that I'm doing so I can just have more project at the same time. Are you are you outsourcing with virtual assistants? how are you doing that? Some time I I did that with virtual assistant but it didn't really work for me. I rather work with really highly specialist. Like if I want an automation, I don't want to teach the virtual assistant to do that automation. I prefer to hire a developer to do that directly. So I am working with specialists like this developer, graphic designer, all of it.

26:51 So how is you mentioned earlier with your engagement with AI? Can you talk about in your business and writing the book and helping people evaluate businesses? What's been your engagement with AI at what level over the past twelve or twenty four months? Well, I've used it a lot for you know you can create content with it, you can build AI agent to automate things. Like at the moment, for example, I am automating my blog because you know you can be creating it with AI, but what if you have solely copy paste less that's not fun, like might as well completely automate it.

27:34 And so I am creating those different things, like anything that it's going to be repetitive online, I think it can be automated. And this is a great way to reduce funder dependency, by the way, and increase, you know, the the valuation of a business. What do you think? Yeah, I mean, I think that what I think what all entrepreneurs are looking for. So let's say anyone that has anyone working for their company, let's say it's not a company of one. The founder has scaled a little bit and they have they have employees. What we're all looking for is to find other humans to buy into this idea and this dream and this vision we have for our business.

28:20 And what you'll find is is that you need to have Really good incentives. Incentives aren't just income and pay, but why would they want to come and do this with Muriel? Why would they want to come and do this with Mark? So an incentive is beyond just their compensation. But what we're finding is that that's becoming harder and harder and harder. And I can't tell you exactly why it is. Like for example, I was on a construction job yesterday, and there were some there was a crew of people building a wall. And these stone walls. And I talked to the owner and I said, Hey, I've noticed this guy over here. He's a really good worker. he stands out. He's completely different than everyone.

29:00 You don't have to tell him what to do. He already senses what needs to happen. He's doing it before you ask him to, before you need that before you need things he's already doing. So I'm going somewhere with this. And and he said, in 30 years, he's the best employee that's ever worked for my business. And so here's what I know. Every business owner would like to have every employee or partner working at their firm and business be just like that guy. But but it's tough to find these people. I can't tell you why. I don't know why. I don't know why every human doesn't have this. And so what I would say is all the founders and the entrepreneurs that I know really well that are highly successful, they will actually overpay for that type of employee.

29:44 They will. They will. But they're so hard to find, we've had to look for other areas to bring efficiency and scalability inside our business. And unfortunately for humans on the other side that want to be employees that don't want to be entrepreneurs, unfortunately for them, if they're not choosing to be like that great worker from yesterday inside your your job, if you choose not to be that, AI is going to present new opportunities for founders and business owners and leaders. And so it's not it's not going to eliminate AI isn't eliminating the opportunity for humans to have jobs and careers. What it's going to do is it's going to el eliminate the need for mediocrity from average performing employees and businesses.

30:30 So that's what I'm seeing with AI with these agents. Us founders, leaders, business owners, we're going to use these systems so that we have someone that's acting like the employees that we wish we had. Yeah, it's yeah, it's a nice way to to say it. I think it's AI can yeah, replace some task that some employee will be doing. In in some job it's impossible, I think, to that AI replace them, you know. It's impossible if somebody's doing a quality job. That's my point, right? Yeah. If if someone's doing a quality job, I don't want to replace that. I want the And I'm sure yeah and I'm sure that that person already is, you know, using some sort of AI to be even better.

31:17 And I think a anyone can use it now just to get better at what they do. But in some I don't know, like I I was taking the plumbing business example. I don't think a plumber there will maybe there will be some AI enablement, you know, like but when they go and they're repeating. pair there it's still an in human doing it and so what you're saying is very relevant. Like the one who's gonna do the good job or or who's not gonna fix the the bathroom, you know, like failing at it every time. Like you you see the the difference. Yeah. That's it. And I think even what what can happen is a plumber who isn't the entrepreneur or the business owner, if they're a plumber, they actually can AI use AI to become more efficient.

32:07 You know, we used to type things into Google. Well, AI is just a more efficient response and engagement system, is what it is. If we're having if we're right, it there's many things above and beyond that, but for an employee, it's a system that allows them to do their tasks in a more efficient manner. And at a higher quality because it can reinforce are you doing this right? Are you not doing it right? Can you look for different ways that this has been done recently? can you go into hey, it could be quad or chat GPT, whatever the name of your AI is. You could say, Hey, can you look at the total landscape of plumbing businesses in Milwaukee, Wisconsin? And can you go through the testimonials that customers are giving at a high rating on Google and tell me what they appreciated about the experience?

32:52 It's questions like that. What did they most appreciate about their plumber? And it could give you insight on what customers are really appreciating. Right. It it might not just be about fixing the leak. It might be about how you engage with them when you arrive to their home. It might be if you run into a problem that's gonna cost more, it could give you some soft skills on how to engage with the customer. So, all those things, that's what AI is gonna allow us to do more on the average level. There's a lot more higher level stuff. So Yeah, I I think for somebody evaluating businesses, it can help you evaluate the business where you might not need attorneys on the front end. You might not need accountants on the front end. AI can do some deep forensic things if you give it the information.

33:35 Yeah, as well. Absolutely. I am thinking to create some sort of calculator, you know, for when I do my business evaluation diagnostic just to help and show. yeah. As long as you give them what you want, exactly. If you don't know what you want to build or how you want them to take into account, you will get maybe not a like a weak result. But if you know what you're talking about, you will get yeah, you can for sure when I was doing my you know, I was trying to buy businesses, I was giving a lot of information.

34:18 It was helping me a lot. You know, without disclosing, you know, the name of the company or anything. It was helping me a lot. Yeah. What so I know that, you know, there's there's small business administration loans out here. A lot of people utilize those to acquire businesses. And, you know, you have more expertise in this area than I do, but I believe they'll fund up to probably five million dollars somewhere in this range. They do, yeah. So speak to this process a little bit more. If someone's never owned a business, what's that process like to go try to get an SBA loan? Like where do they go? What's the experience look like? Okay, I think the first step is to go to a SBA lender, so a bank that will do SBA loan just to get SBA approved.

35:07 Both business owners can do it and buyers. That means that the the lender is going to ask for various information and give you a bit like your your your landing capacity and just give you a letter. That says, okay, your SBA approved, you can show that to sellers so they know you can get a loan. This is the very first step. And then once you find a business you have you know offer accepted, you will go back to your bank, say that they're going to ask for the financials and a lot of information are going to ask you for a lot of information and and start their process and this is taking time. They might renegotiate already a few things, say, whoa, your offer was too high.

36:03 Like this we're not gonna finance this. It will be less. Maybe you need to ask for a bigger seller note. And so this is the process. Hmm. What who's your ideal customer or client? So you're building your business, you're writing your book. Who are you really trying to attract? Who are you trying to work with? Yes, so funder led service business owners that do between five hundred K and ten million dollars in revenue and it's I'm happy you mentioned the SBA because because buyers like me and many of us we will use the SBA loan and usually this business doing between five hundred K and ten million dollars in revenue, there are financed, you know, by SBLO. Let's say that private equity, you know, investors, they are less interested in those businesses.

37:00 Though if they have a super high like a one million dollars cash flow, yeah, they might come into competition with you. That happened to me as well. When when a business is really good, they are on it as well. What do you so five hundred thousand to ten million? What does the what's the multiple? Is the multiple based upon a lot of people hear this word this this term ac the acronym EBITDA? They don't know what it is, but it's pretty much the profit before you pay taxes. Right? That's pretty much that's pretty is that a good way to say it? ~ It's earning before interest depreciation and amortization.

37:43 Yeah. So all of that. And and this is the yes, the the the right number we're looking at, the Ibidah. Yeah. it's pretty much like, hey, how much are you gonna make on the business? Like that's just what we're getting down to. Right. And so a lot of a lot of commercial real estate, I'm involved in a lot of real estate, those are sold on what are called cap rates. It's just an X as well. A cap rate is cash on cash business. This'll be a seven cap rate. That means that if you buy it for cash, you can get a seven percent return on your business every year. If it's an eight X, eight cap, eight X, so your sell your selling business is probably For three to six times that EBITDA or somewhere around it. If it's one or two, boy, that's a business that it's like, wow, you might not have any good customer base, you might not have good consistent revenue.

38:31 But if you take, let's just say, a five million dollar sales business, what's a good EBITDA on that? Just in general, Carl, I know it's different with different segments, but what's what's good? A million dollars, 750? It depends what they sell for sure. it's really hard to answer that question because you know, if they have a lot of inventory and everything there we sell they have to you know, they have a lot of spending to get the five million dollars in revenue, then my they could have just five hundred K in Ibita.

39:12 Yeah. You know, like it depends why the service business with very lean in operation, don't have much, you know, you know spending to deliver the service, yeah not of overhead. they might maybe they are making two two million inhibida, I don't know. Is a big problem that you find in these businesses that the owners a lot of times will run a lot of their expenses through the business, therefore it takes away from the EBITDA. That's a big problem, isn't it? on being able to evaluate the business. Yeah, but but so this is why there's a lot of debate here. because you know there there are a lot of things they are not supposed to do, but at the moment where they want to sell the business they disclose everything.

40:03 How they did the trip with the family, I don't know, ten thousand dollars back. It will be an ad back. you need to accept it so they get, you know, more money when they sell. All the restaurant, all everything. They disclose it all how it was personal. Even the the family, let's say they have a a son, a wife, a father working in a business. they're not working there. I just give them a salary. you know, it's just money they're getting. So this is so bad for, you know. Tax purpose they're not supposed to do that, but when they sell, they disclose it all.

40:46 Yeah. It's kinda funny, isn't it? It is it's hilarious actually. Yes. Yes. what are you as you build your business and you're gonna write the book, what are your own goals for your business? What's your approach to setting goals, to projections, to is it a three to five year time frame? Is it just the next twelve months? Is it more a passion project? What's your approach to seeing what the legs and what the wheels on your business are gonna do going forward? Creating my own sort of PL with putting all my numbers, like the revenue coming in, what I'm spending on what, and with a bit like my objective.

41:31 Like I I imagine I put on the PL how much I'm supposed to bring in so I can do this, this, this investment. So this is how I approach it. And for now I just created it for twenty twenty six. But I mean it's just something I can replicate for other years. I haven't done it for and I did that only I'm going to tell you, I did it because the lender they ask you to do that. They ask you to do a simulation for three years. They say, you know, it's very interesting. I'm going to do it for my own business, even if I don't get a loan. Do you think you'll acquire or buy any more businesses? Do you think you will? Or will you just advise, consult, do strategy?

42:16 I am still interested. I'm still interested to yeah to buy a business but most probably I think off market. I think the business I have built helped me to find also off market deal. Like just today I was I spoke with a business owner. He was telling me yeah, I we want to to prepare with thinking about it. Yeah, and the and the call that I had with him was not even to discuss that. It was more a a one on one networking sort of exchange, but they they think about it. Like many of it Talked a little bit before the podcast that w we didn't you didn't have the exact number of business owners that are gonna retire over the next decade.

43:06 But I I think it's it's tens of thousands and it it's something equal to like a few trillion dollars. They're either going to be sold or they're just gonna shut down because they're retiring. Right? This is coming. It's a huge opportunity for people to acquire businesses right now. Yes, because it is the period for a few more years where all the baby boomers are retiring and a lot of them were business owners. So well I've heard this in some media talking about the biggest transfer in the history. And it's either you you you know, get a piece of it or it just disappear.

43:48 Yeah. And I must say yeah, I just now when I see some business that are close, you know, I'm wondering. I don't know. Was it a business that failed or was it a business nobody that didn't think they should sell, you know. Like I don't we don't know. Yeah. Yeah. So maybe that's a part of your passion project, right? To help all those people. Not just to help buyers acquire, but help those people sell their businesses. Help them Yeah, exactly. I want to help the business owner sell their business at a higher valuation because as buyer, since we're using loan, okay, to be buying a business, we don't mind paying more for a good business.

44:32 What we don't want is to buy a business that that disappear the moment the funder leave. So it's a it's a win win situation helping the business owner rebuild a bit the business in a way that is less risky for the buyers. So I could benefit from it, you could. Anybody interested in buying businesses could benefit from it. Yeah. so when when's this book come out? Do we know yet? Yeah. Yes, july twenty seventh. July twenty-seventh. We'll make sure that we we come back to this episode then as well on the twenty-seventh. Do you find it may maybe to to wrap up with a final question here? Do you find in talking to owners of businesses that it's it's very emotional?

45:21 Yes, I yeah. Can be for some it depends. I honestly it depends. I've noticed in younger entrepreneurs they are more like serial entrepreneurs. I don't think they have much emotion. They are here for the you know, the the thrill, I don't know, the the sensation that they give them to build a business, exist and and they do that. And yeah, maybe the baby boomer who has been running the business for forty years, yeah, it's probably very emotional. And they want to make sure I I mean it depends again.

46:01 Some would like to just get the money and leave. because I have been signing some L O I for you know like business like that. They just wanted to retire in Florida and just leave and almost no transition. So you have business owners like that. But you have some and I think most of them really care about the you know the the brand. They they have built the legacy, keeping the employee, making sure things continue for the client that they had. They have the employee, the the process, the everything they want they want everything to continue.

46:44 Just like when they were there. Yeah. Makes a lot of sense. So what do you what do you want everyone to know that listens to this? Do you want to go buy the book? Do you want to come to your website? Do you want them to come talk to you about selling their business? What does Muriel want to happen from this episode today? Okay, you could for example go to my book page and download the first chapter of my book. It's on exit3dstudio dot com slash D dash valuation dash gap and you can get the first chapter. Also have exit readiness scorecard to also Calculate and see where you stand on the Read the first chapter, which will you'll go into Muriel's funnel, which will then be a link to buy my book when it comes out, which then'll be a link to put your business in if you want to sell.

47:42 it seem it seems like you're taking a very smart approach to the business. I hope that the people that you help is ten or twenty or thirty X even the significant profit and money that Muriel's gonna make. And you have a you have you have a you have a good Make more money than me for sure. That's the sale. There's the sales, Muriel. It c it comes out. the well, I'm excited to have you on this side of what they call the pond, right? I'm glad to have you on this side of of the Atlantic with us for five years. And so give us in in the parting here, if we go to France, give us a little tidbit, give us Muriel's best advice for anybody. And if you give us the right advice, they might come back to you and sell their business with you, Muriel. Well, give us the best advice if we're going to France.

48:26 Well first of all I am from Nice and I think it is the nicest region in France. So French Rivia I think is more fun than just Paris. So if you plan a trip to Paris, come visit also the French Riviera. We we our culture is really blended with like Italian culture. It's it's the only place in France that is like that. It's yeah, it's just beautiful. You go between I will say between June and September is the best moment, although we have nice weather all year long.

49:06 We have good food, good wine, good weather. You can go skiing also, it's not just the beach. Lot of hikes, yes. So sell so sell your business with Muriel, buy her book so that you can afford to go on your dream vacation and go to the French review. There you go. It's that time of the year. We're coming to this June moment. Way, thank you for the time and and share them with the Ected Three D studio and and what you're doing and the book coming out. So go to your website, we'll put all the tags up, read the first chapter, and then start engaging with everything that Mural's doing.

49:48 So I appreciate the time you've given us today. Well thank you Mark. I appreciate to have had this opportunity to to talk with you today. It was fun. Yes, thank you very much.