How a Non Compete Almost Derailed The Sale Of This $14M Business
December 16, 2015 |
Want to increase the value of your business by up to 71%?
Take the 13-minute survey and get your Value Builder Score
About this episode
Subscribe:
In this episode John Warrillow interviews serial entrepreneur, Kevin Kruse. As Kruse moved to exit Axiom, the ultimate buyer wanted to avoid competing with Kruse down the road… and that’s where the negotiations hit a giant snag.
How long will you agree to be sidelined when you sell your company?
Your “non compete” is an agreement you sign promising not to jump back into the industry you’re bailing out of. You may think the idea of starting a business similar to the one you’re in today is far fetched, but after tiring of golf and failing as an angel investor, many cashed out entrepreneurs decide to start a business just like the one they left – which is where your non compete can be a hindrance.
In this episode of Built to Sell Radio, John Warrillow interviews Kevin Kruse. Kruse is the kind of guy you just know is going to be successful. Kruse has written six books – one of which was a New York Times Bestseller – and sold several businesses before he started Axiom, a training company he built up to $14 million in sales. As Kruse moved to exit Axiom, the ultimate buyer wanted to avoid competing with Kruse down the road… and that’s where the negotiations hit a giant snag.
As you listen, you’ll notice Kruse went out of his way to merchandise his managers as the heroes in his company’s story. Your management style is one of the eight factors we measure when evaluating your business’ readiness to sell. To find out how your business is doing on all eight drivers, complete your Value Builder questionnaire.
Our guest
In pursuit of the American Dream, Kevin Kruse started his first company when he was just 22 years old. He worked around the clock, literally living out of his one-room office and showering each day at the YMCA, before giving up a year later deeply in debt. But after discovering the power of Wholehearted Leadership and Employee Engagement Kevin went on to build, and sell, several multimillion-dollar technology companies, winning both Inc 500 and Best Place to Work awards along the way. Kevin Kruse is a New York Times best selling author, an Inc 500 start-up founder, and his newest book, 15 Secrets Successful People Know About Time Management, is based on groundbreaking research into the habits of Olympic athletes, straight-A students, over 200 entrepreneurs and 7 billionaires, including Mark Cuban, Dustin Moskovitz, Andrew Mason, Mark Pincus, Kevin Harrington and others.
Related to this topic
How One Key Hire Helped Dimple Up Their Value By 500% in 2.5 Years
Teetering on the brink of liquidation, a key hire at Dimple led to a dramatic turnaround that resulted in a $13.4M exit.
The secret to negotiating a sale with a multi-billion dollar corporation
Along with her father and brother, Laura Coe grew Litholink into a $10M business with 50 employees. Then one day, a multi-billion-dollar business called.
, John Warrillow interviews Phil Carson, the founder of a diabetes testing supply company. Carson wanted out of the business he and his partner had built from the ground up.
How Jennifer Aniston And Reese Witherspoon Helped Viviscal Exit For 15x EBITDA
With celebrity endorsements like Jennifer Aniston and Reese Witherspoon, Viviscal hit €50 million in revenue…so, why would the CEO want to sell it?
Why Policy Medical Got 7.2 x Revenue
Saud Juman built PolicyMedical, a company enabling hospitals to document their procedures and policies, into a software company growing 100% a year when he sold it for 7.2 times revenue. It was a remarkable exit for a business Juman started in his mother’s basement.
How Mainspring Went From a Valuation of 1 to 5 Times Revenue
In 2014, Hank Goddard got an offer of one times revenue to buy his software company, Mainspring Healthcare Solutions.
into a profitable business after year one. Ten years later he sold Merced for $192 million, equating to over 3 times top line revenue.
What to Do When Your Partner Is Not Ready to Sell
Tyler Jefcoat co-founded Care to Continue, which provides in-home care for seniors, in 2012. Jefcoat built the company to more than 100 employees when he got an offer from a private equity group for more than five times EBITDA. Jefcoat was thrilled. The only problem? His partner wasn't ready to sell, which kicked off an acrimonious battle ending with Jefcoat selling his shares back to his partner.
From Paper Sketches To $441M Sale
Oribe sold in early 2018 for $441M, but in 2008 they were just a few sketches of shampoo bottles on a piece of paper. Tev Finger shares the surprising tactics they used to drive revenue.
Rick Martinez is a military nurse who stumbled into the staffing business by accident and grew his company to 600 employees. Then, when he decided to sell his business, he took a surprisingly zen-like approach to negotiating the deal.
The first time David Phelps sold his dental practice, he ended up in a legal battle that cost him more than $100,000.