5 Ways Every Small Business CEO Should Think About M&A In 2023

I recently worked with an accidental CEO early in her career. She took over a business upon the sudden death of the previous owner. She stepped in as the interim president, not knowing that she was walking into a situation that would ultimately be a turn-around or shut-down situation. Or, that this would become her new career.

Not only did she succeed in turning the business around, she now leads a larger and very successful business, less than 10 years later, and is now looking to acquire a company in order to expand.

Why Small Business CEOs Should Consider M&A Right Now

Mergers and acquisitions, M&A, partnership concept

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As a small business CEO, if you are not thinking of M&A as part of your strategic growth in your 3-to-5-year plan, you are potentially ignoring the largest opportunities for growth. If you are waiting until the economy stabilizes, you are missing an opportunity. As you consider acquisitions, there are five things you should contemplate:

1. Is your house in order? Do a self-audit or at least look in the mirror before starting down the road of a transaction. Do you have the right players, in the right seats, and is everything running smoothly? Understand where you will be stretched during a transaction and where you will pull from to meet the needs.

2. Understand your risk tolerance. Identify the risk you can tolerate if things don t go according to plan with either your organic business or the slowing economy. Do you have your reserves and contingency plans? Thorough due diligence should be expected; small and mid-sized acquisitions by small and mid-sized companies often mean more detailed due diligence because of the catastrophic impact a failed deal could have on a business. Involve your team members in the diligence as practicable; besides becoming invested in the success of the transaction and post-integration, they become better leaders as a result.

3. What s the growth opportunity? Specifically, what s the strategic growth opportunity? M&A can drive growth, especially during slower economic times when organic growth may be lagging.

4. What s the culture like? Culture is often neglected, especially in small deals, even though people and culture are a significant part of how the small business became successful. Culture diligence is as important as financial and operational diligence. A culture clash can kill a deal or cause a post-deal integration failure.

5. Are you being bold enough? Through exponential growth, a small business can disrupt an industry and become the industry leader. Acquire one business a year and you can be positioned to be that industry leader. In short, don t miss an opportunity by waiting for a stable economy; a good deal in tough times is a good deal.

Finally, if you are struggling to contemplate these on your own, seek some help. Smart small business owners know they should work with mentors and coaches to help them navigate the expansion of their business. You are heading into unfamiliar territory. It only makes sense to have someone who s been there to help you navigate the process and help you take advantage of the M&A opportunities in your industry and business model.

As a Vistage Chair, I work with high-performing CEOs like you who are committed to what we call a life of climb —continuously working together to be better leaders who enjoy better outcomes for their companies. If this article resonates with you, I invite you to connect with me by email at [email protected], or on LinkedIn.

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Educational Consulting Is Knocking: Should You Answer? 5 Things You Should Know

As they say, life is what happens when you are busy making other plans. In spring of 2016, I had just returned eastside after spending some time in California and found myself at a crossroads. Would I return to a full-time role or hang my own shingle as an independent educational consultant?

Although the inherent lack of job security certainly provoked great pangs of anxiety in me, I decided nonetheless to try my luck as an education consultant. I had, over the years, developed deep skills in coaching teachers and school leaders, and I wanted to try to utilize those skills across organizations and schools. In what other capacity would I have had the same opportunity to assess American curriculum schools in Dubai, help the Ministry of Education of East Timor reform its middle years 21st-century curriculum, and/or work with the Lakota nation?

Sometimes it takes an outsider to an organization to accurately assess the needs of that institution and to offer solutions to pain points that an insider might not see. However, consulting also is not without its share of drawbacks.

Here are five things you need to know about educational consulting before diving into this pool:

You Need A Brand

Educational consultant talks to teachers

As says WID global marketing expert Lisa Perry, “everyone” is not your customer. Education is a vast and growing industry. There is K–12 and higher education. There are those who advocate for education policy, support school network operations, market and then train educators on various school support products/resources, and still others who are practitioners of teaching and learning from cradle to senior daycare. What kind of consultant would you be? What pain would you solve? With whom would you work in education—policymakers, advocacy organizations, EdTech, government, publishers, schools, districts, and/or states?

You Might Juggle Different Tasks And Organizational Cultures

Educational consultant talks to a client

Different strokes for different folks. Some education consultants thrive in providing a service to clients. Often, this means working with boards to develop strategic plans and/or to engage in school improvement conversations, coaching teachers, training people, and/or developing the leadership capabilities of others. Some education consultants provide products such as writing a curriculum or designing a data assessment tool. Some consultants provide both such as those who might train others on the use of assessment tools, digital learning management systems, and/or a new textbook series.

Consider if you work best as an independent consultant, sub-contractor, and/or as a part- or full-time employee. As an independent, you work out the details of your work with the client. You are responsible to yourself/them. As a sub-contractor and/or part-time consultant, you will still have some say in assignments you accept but this work may come with certain meeting/teaming responsibilities which can be a challenge when working on several contracts. As a full-time employee, you may receive benefits and job security but have much-reduced autonomy. Cleopatra was bitten by a snake; pick your poison.

You Must Network

Woman works as an educational consultant

Consultants who are not full-time employees need to be experts in three things: practicing their craft/area of expertise, invoicing, and looking for their next gig. I know of many consultants who have worked long term with just one or two organizations. However, if a consultant must work across organizations to earn a living, they will want to increase their networking while maintaining their existing portfolio of work/clients. Consulting is by nature a great way to rapidly expand one’s network of peers especially if one is working as part of a consulting team. Post original content and curate that of others on social media daily.

You Will Have Work Cycles

Man works as an educational consultant

One never knows when a consulting opportunity will materialize or end. If an organization decides to rebrand itself, and you do not fit that image, you are easily expendable. Other times, one might find a new client and/or contracting firm to be a bit disreputable. Much like B actors, get used to being fired. Have networking leads in the hopper to ease the anxiety that will come with lost revenue.

Winter is always coming. I lost approximately 90% of my income due to initial COVID-19 shutdowns, and, while much of that work has returned, waves of subsequent COVID-19 mutations still have led to many sleepless nights. At other times, one might be awash in gigs. So, budgeting can be difficult. With that said, the roller coaster ride that is consulting can level out particularly if one is fortunate to find consistent consulting work with one firm and/or client over a multi-year period. Such work may even lead to new full-time opportunities.

The Value Of Your Work Will Vary

Mid-career teachers transitioning out of the classroom and retirees can often find rewarding part-time or full-time roles as training facilitators and marketing or sales representatives with school support/product organizations and textbook publishers. This work will be paid a mid-range salary or day rate that might be equal to or above that of which one might earn as a teacher.

More senior consultants, those who previously served in school and district leadership positions, can earn better money serving as school improvement, policy, advocacy, and strategy consultants either working as independents or as PT/FT advisors with consulting firms. High-profile management consulting firms tend to hire newly minted MBAs, also at high salaries, but with very high expectations in terms of time commitment and deliverables.

Please feel free to reach out to me at John Schembari, Ed.D. | LinkedIn.