Jeremy Furtick comes from a long line of entrepreneurs – his great-grandfather ran a Dallas dairy farm at the turn of the 20th Century, his grandmother founded one of Dallas’ oldest private schools in the 1950s and his parents started a specialty advertising firm in Garland in 1982 that is still in operation.
So it’s no surprise that Jeremy would find himself working directly with business owners today. He understands the unique challenges business owners face and knows how important business transaction services are to their futures. Jeremy’s education, creativity and experience, along with his straight-forward, meticulous personality are all keys to his success.
Prior to Sigma ending its contract with the world’s largest business sales franchise organization and becoming an independent firm, Jeremy became one of the most decorated and successful agents in the 35-year history of that franchise.
Starting in 2007, his first full year with the business, Jeremy was named the franchise’s No.1 worldwide agent – the first “rookie” to achieve this prestigious feat in franchise history. He finished No.1 a second time in 2013, becoming the franchise’s only repeat winner. And in 2014 he was well on his way to another No.1 ranking before Sigma ended its franchise relationship. Jeremy was also a top-ten agent three other times, and received the franchise’s quarterly National Victory Register award 25 times in 33 quarters.
Jeremy graduated from Texas A&M University in 1998 with a B.S. in journalism and a marketing minor, before earning an MBA from The University of Texas at Dallas in 2003. Prior to joining Sigma, Jeremy spent seven years at KRLD NewsRadio 1080 and the Texas Rangers Radio Network in advertising sales and sales management, then served as vice president of accounts with Reef Securities, an oil and gas broker-dealer.
Jeremy is also a licensed real estate salesperson in the State of Texas.
Connect with Jeremy on LinkedIn.
What You’ll Learn in This Episode
- How to identify a “good” business intermediary vs. a “bad” one
- Mistakes buyers make with business intermediaries
- Qualities business intermediaries are looking for in buyers
- What needs to be included in your LOI, and what is irrelevant
This transcript is machine transcribed by Sonix
TRANSCRIPT
Intro: Broadcasting live from the Business RadioX studios in Atlanta, Georgia. It’s time for Buy a Business Near Me, brought to you by the Business Radio X Ambassador program, helping business brokers sell more local businesses. Now, here’s your host.
Stone Payton: Welcome to another exciting and informative edition of Buy a Business Near Me Stone Payton here with you. Please join me in welcoming to the broadcast with Sigma Mergers and Acquisitions, Mr. Jeremy Furtick. How are you, sir?
Jeremy Furtick: I’m good. Stone I appreciate it.
Stone Payton: Well, we’re delighted to have you on the show, man. One of the questions that has been burning in my mind and now I am going to ask it how do you identify a good business intermediary versus a bad. What am I looking for?
Jeremy Furtick: Now. It’s a great question, and I think it’s something that that individuals looking to buy a business really need to pay attention to. But there’s just a couple of key things. When when a buyer is looking for a business is, number one, when you’re talking to a business broker or a business intermediary, you need to make sure that that individual understands the motivations of their client, because there’s nothing more frustrating than getting to a point in a process where a seller just decides they don’t want to sell anymore. And that’s incredibly frustrating and costly for a person looking to buy a business. And if a broker doesn’t qualify his clients properly on the front end, then you could potentially run into a situation like that not only qualified to sell, but also motivated to sell has the right motivations. Those are important to understand. It’s also critical, in my opinion, that the business broker you’re working with actually has a process that they follow. You should be able to get on a first phone call with a business broker or a business intermediary and say, okay, explain to me where we go from here. And they ought to be able to lay out step by step, a process from this point all the way through to closing and even post closing about. Here’s what you can expect as a buyer to get from our office and from our clients. If they don’t have that process. Then you can expect that this is probably potentially going to be a challenging endeavor to go through because if they’re not running steering the ship, so to speak, then who is? And that’s just going to be frustrating for you and frustrating for for their client as well.
Jeremy Furtick: And I really think the last thing, if you want to just talk about three key points is you want to find a broker that is understands their role. Their role is to be a filter, not necessarily a blockade. Our role is not to inhibit, inhibit the buyers access to a seller. It’s to make sure that because we all know everybody wakes up on the wrong side of the bed every now and then. And in the midst of a business transaction like this, some things could be said from one party to another that may derail a deal just because somebody had a bad day. It has nothing to do with the business, nothing to do with the deal, nothing to do with the individuals involved in the deal. But you can say the wrong thing at the wrong time, and that could potentially cause a deal to fall apart. When those things get said to me as an intermediary, why filter what gets back and make sure that just the important aspects that are deal related get translated or communicated to each party as opposed to the emotion. And so that’s an important role. You never want a broker or an intermediary that just sends you information via email and says, Hey, here’s the seller’s phone number column and you all work out the deal and just tell me where closing is and I’ll be there to collect my commission. That doesn’t work. And if you run into somebody like that, then you can almost be assured that the process is just not going to work for you.
Stone Payton: What is a quality broker looking for in me? The buyer? What qualities are they looking for?
Jeremy Furtick: Well, again, a great question because it is a two way street, just like all the things we just talked about that are important for a buyer to understand about a broker that they’re potentially working through. The broker is also, in our case, we’re talking to between 85 and 100 buyers on every one of our listings. Well, eventually one person is going to buy it. So there’s going to be 84 to 99 that don’t. And a lot of those are people that we weed out. So it’s important to understand what a broker is looking for and what’s going to make you stand out, because it is a competition. It’s very rare that you’re the only buyer on a deal and if you are, you might be a little worried about that. But number one is know where your money is coming from. I mean, it sounds so simple, but I can’t tell you how many times I’ve talked to somebody and say, Hey, just out of curiosity, explain to me how you’re going to fund or finance this deal. And when I hear the answer, I’ll I’ll get a loan. That’s an immediate check out for me. I just know that that this person hasn’t done the things that they need to do to get prepared to make a deal happen. So know where you’re getting your money. Have that lined up before you start your business search, not only before you inquire about a business, but before you even really start looking at any businesses, know where you’re getting your money. I think another important aspect is when you’re interacting with the business broker.
Jeremy Furtick: I mean, we all know the when you’re talking about families, people who have kids, people love to talk about their kids, Parents love to talk about their kids. And it kind of wears you out on the other end of that because we get tired of hearing about your kids. Business owners are the same way. They love talking about their businesses. They’re so proud of what they’ve done. They’ve got so much pride in it and so much ego wrapped into that that you need to be conscientious of as a buyer of make sure you let the the seller talk about their business. Don’t tell we always talk about this is one of two things as a buyer ask, don’t tell. Make sure you’re asking questions, that you’re inquisitive, that you’re generally interested in the business because the seller loves to talk about their business. I don’t tell them all the things about you. Don’t tell them all the things that you think about their business necessarily, but also be impressed with their business because buyers love to hear excuse me. Sellers love to hear all the great things about their companies. And if you can come across as being impressed with their business and very complimentary of their business, well, that just goes a long way with when they’re looking at four different offers on the table and they get to yours and they get a warm fuzzy when they think about you because you could not stop saying enough great things about their company. That can be the difference between getting a deal and not getting a deal.
Stone Payton: So what is your back story, man? How did you get into this line of work?
Jeremy Furtick: Actually, it’s interesting because I certainly never thought I would be in it. I used to sell radio advertising, of all things. And but the station I was at, as opposed to the typical radio where you think of where ad agencies buy a lot of airtime and they’re buying points if you’re familiar with that in the industry. I was on a news talk station, and so we did a lot of what we call direct selling. So it was literally going in, sitting down with a business owner, identifying what their needs, objectives, budgets, all those things were, and then coming up with a creative solution on how our station could reach our listeners with in an effective way that’s going to get their phone to ring. And when I came over and started working here at Sigma back in gosh, it was 2006. I was shocked at how much the skill set translated. It’s the same thing. We sit down with business owners, same people, but now we’re talking to them about a different set of objectives and motivations and goals. This time it’s to exit their business, not necessarily to to to grow their business. And so it really worked well that that experience translated very well. And so it’s just been a natural transition. And I’ve enjoyed pretty much every minute of it since then.
Stone Payton: Well, and this work is far more I’m learning by hosting the series, actually far more grounded in relationships than I ever anticipated. I kind of viewed it as as much more transactional, and there’s certainly that aspect to it. But man, when it comes down to it, I mean, this is a relationship business, isn’t it?
Jeremy Furtick: It is. And you use the term transactional, which is ironic because we use that term daily that this is not a transactional business. This is not a transactional process. There are transactional aspects to it. Of course, there’s very in this whole process, there’s a lot of black and white, there’s a lot of the numbers are what they are and you’re evaluating financials and etc.. But it really does come down to the old adage of people want to do business with people they like and trust. I don’t think it could be any more true in any other industry, more so than it is in our industry, where not only the sellers want to work with intermediaries that they like and trust. I want to work with sellers that I like, trust and respect. And same thing goes for buyers. I want to work with buyers that I feel like you have a fiduciary responsibility to your client, but you also end up having a These people become my friends. You work with them for so long and you want to see them be able to hand the keys off to the to the machine that they’ve built and right off into the sunset and be thrilled with those results. And most sellers have a lot of pride in who’s taking over my business and is going to continue the the brand and the legacy and the name and the reputation that I built. And those things are important. And so relationship is a massive piece of that.
Stone Payton: So, I mean, clearly you’re finding the work incredibly rewarding. What are you enjoying the most, man? What’s the most fun about it?
Jeremy Furtick: I think what’s personally what the most fun is, is the there’s no day that’s the same. And we have a process, of course, that we follow, whether it’s working with sellers, whether it’s working with buyers, marketing businesses. There are certain steps that we follow 100% of the time. So you think, okay, well, that’s repetitive and can get stale. But the fact is, is that you’re dealing in every one of those deals, even though it’s the same basic process, it’s different personalities, it’s different sized businesses, different types of buyers, different industries, of course. And every deal, even though, again, we’re running the same process, no two deals are alike. Every deal is unique. And so it keeps it fresh on a daily basis. There is a you know, there’s certain parts of it I like more than others. But I think that the biggest kick that I get out of it and the most enjoyment I get out of it is really when you can see a seller start to believe that what they’ve been working for for sometimes 50 years is coming to fruition. And that’s an exciting time. And on the same token, you look at the other side of that coin, a buyer is almost equally as giddy because they’re getting into something that has been an objective of theirs for however many years that they’ve been dreaming about controlling their own destiny and owning a business. So I liken it a lot to think about a football field. Every football field got the same sidelines and that’s our process. But every game and every play that’s run within those sidelines is unique and you very rarely have any repetition. So that’s really what keeps it fun.
Stone Payton: What a great analogy. So how does the whole sales and marketing thing work for you? How do you get the new clients? Well, at this.
Jeremy Furtick: Point in our life cycle as a business, it’s really less about our outbound marketing and more about referrals. And I’m talking about seller sell side clients. We’ve been around for so long. This office has been here since the mid eighties and I’ve been here since oh six. I’m to a point now where I’ve actually sold the same business three times in one case because it’s and those were buyers that came back to us after they bought a business from us. They came back to us and said, Hey, we liked what you did for your client back then, we want you to do it for us. So referrals are a big part of it. The way we market to buyers. So really two sides of this business, of course, there’s buyers and sellers. You have to have both to have a deal. And 75 or so percent of the time we’re representing the seller as opposed to the buyer. But the way we market to buyers is, is we’ve really spent a lot of time and money building our database of buyers so that every time we get a new listing, we’re marketing to them. We know the size business, the industry, the geography, the cash flow that they need. We have all that data about our buyer clientele. And so we may have 6000 people in our database. And when we launch a new business, there may be 750 buyers that fit that criteria of that new listing we’re launching. And we give them, we call it a sneak peak or a preview of the business before we take it out on the open market. And generally speaking, over the last decade or so, we’ve sold about two thirds of our listings to people that are already in our database.
Stone Payton: Let’s talk about timeline a minute, especially on the seller’s side. If I’m looking and planning an exit, I mean, this is not something that I decide to do today and try to get done in a couple of months. I’ve got to get my ducks in a row for this thing. Right. So like, when should somebody be reaching out to you to start organizing all that?
Jeremy Furtick: I think if you can force yourself as a business owner to to get with this before you’ve even thought about selling, that’s ideal because then we can start helping you lay the groundwork for the things that you’ve got to do to make the process easier when you do decide to do it. But most of the time people have started thinking about selling and they’ve talked to a couple of buddies on the golf course or they’ve talked to a couple of people that their neighbors that they know have been in business and sold the business or bought a business. And so by the time they get to us, they may have been thinking about it for six months to a year, but not really having done anything. They’ve just kind of started taking those mental steps, which is a huge part of it. Again, getting back to the idea that these businesses are so important to these business owners, a lot of times they’re things that they’ve been working on for decades or they’ve taken over family, legacy businesses or whatever the case may be. They’re important. So the mental aspect is a huge, huge part of it. Just if not more important than the financial aspect. But by the time they come to us, we do a business valuation, a market valuation on the business, and we’re able to sit down with those potential clients and say. Now, here are the things that here’s what the business is worth today. If you went to market, what you could expect. And if that doesn’t work. For you financially? Well, here are the things you can do to increase the value. And of course, number one is get more evidence.
Jeremy Furtick: If that was that simple, then everybody would be getting the number they want. But a lot of times it’s more about the intangible things. It’s about making the business more marketable to a buyer where when a buyer is looking at three or four different deals, you’re stands out because it’s it’s just a more attractive business, not just because of the numbers, but because it looks like it’s a business that is replicable, that it’s all the things that are intangible, valuable about it are things that they can’t create overnight. So when a seller comes to us and wants to start talking about that, it’s rare that after the first meeting or valuation that we do that they’re ready to pull the trigger. I’d say probably about a quarter of the time. The rest of the time they either realize that they’re just not anywhere near ready or maybe they just need another six months, another year to kind of clean some things up, whether it’s in their books or in their operation or whatever the case may be. Whatever consultation we’ve given them, the majority of sellers will come back to us then and say, okay, I’ve done it here, check this out. Does this work now? And a lot of times the answer is yes, and that’s when we move forward. But yeah, I mean, to answer your original question, I would say that most buy our most sellers start thinking about the process of selling their business a good year to two years before they actually move forward with it. And it’s usually within six months to a year of first reaching out to an intermediary.
Stone Payton: All right. So going back to the buyer’s side, as much experience as you’ve had, as many deals as you’ve helped broker, have you identified have you landed on like the ideal business?
Jeremy Furtick: The ideal business.
Stone Payton: Yeah, the ideal business for a buyer to go after, like, I don’t know. Like my uncle at Thanksgiving is probably going to say laundromats or some, I don’t know, like, is there that perfect business out there?
Jeremy Furtick: There isn’t. There is absolutely no perfect business. There’s only the business that that makes the most sense to you individually as a buyer. And so there’s obviously businesses that are more attractive to a larger number of people. They have a broader appeal, but that doesn’t necessarily mean they’re they’re the right business for everyone. So that’s that’s the trick is part of that, going back to what we talked about, about good buyers is I tell people all the time, know your story. Know what you want to accomplish? No, what you’re looking for. Know what the the key things are. I mean, every business is going to have 100 different data points or there’s going to be five or ten that are critical to you. And the other ones really don’t matter. And those are going to be different for every buyer. So really know what you’re looking for, not just financially, but operationally, just as important. And so when it comes to a perfect business, we tell people all the time, there’s hair on every dog and that doesn’t make it a bad business. That just you need to understand when you begin your search that nothing is going to check every box. And if it does, then then jump on it quick.
Stone Payton: And what about deal structure? Because there’s a lot of different ways to to skin this cat, right? It’s not always just here’s a check, here’s your keys. There’s a lot of different ways to put this thing together, isn’t there?
Jeremy Furtick: Absolutely. And of course, the SBA financing is a huge tool that a lot of people utilize. And SBA gets a bad rap a lot of times because people have all heard horror stories about what a tedious and difficult process it is. And it is. There’s no two ways about it. I mean, you’re dealing with a government entity, and so there’s a lot of paperwork and a lot of checking and and all of that. But at the end of the day, when you can buy a business for 10% down, that in itself is a pretty ridiculous arrangement to be able to do that. You’re not going to get that deal directly from the seller. So when it comes to deal structure, we see a lot of SBA financing and the max loan amount is $5 million. So you can get a business that’s got a significant EBITA figure and still qualify for an SBA loan. So it’s a great tool. But of course, seller financing is a big deal. A lot of buyers don’t need seller financing. They just like to have it because they like the idea of the seller having some skin in the game long term. And that’s something that getting back to what makes a good business broker, we have those conversations pretty much day one with our clients of are you willing to sell or finance? And if the answer is no, then we make sure that that’s in our marketing that buyers know don’t even bring it up because the answer is no.
Jeremy Furtick: But if it is, then we try to give buyers some some guidelines as to what they can expect or potentially offer. But when it comes to seller financing, as a buyer, if you’re asking for that, a key thing to keep in mind is put yourself in the seller shoes. Number one, why would they do it if it’s necessary? Because their business isn’t financeable through a traditional means? Well, that’s that’s the main reason that you’ll see seller financing. But understand that you’re asking the seller to be the bank. And so the seller may want to go through a similar process to what the bank would to approve you. They want to understand your creditworthiness. They want to understand your other sources of income. They want to understand your background and how it applies to this business. So it becomes more of that. We talked earlier about that warm fuzzy that a buyer wants to give a seller about taking over their business. When you add seller financing to the mix, you’ve added a whole nother level of actual analysis, not just the feel good, but the seller’s got to feel confident that they’re going to get their money from this this buyer taking over their business.
Stone Payton: So I came across a term in a previous interview. L. O. I. I’m operating under the impression that is for letter of intent. First of all, is that accurate? And where does that come into play? And, you know, is there is there something that we should make sure that we include not include the way that we frame Anello, I. Yeah. Speak to that, if you would.
Jeremy Furtick: Okay. Yeah. So Alloy. Absolutely. It’s a letter of intent. And when I explain to people what an LOI is and how it should be used, I describe it as a roadmap for closing because that’s all it is. It’s a non binding agreement that lays out the basic terms that you’re proposing to the seller. Here’s what I want to do. Here’s the the price, the structure. Other aspects that may be important to them. And the seller then is agreeing to those. So it’s not a binding agreement. You get to that. That’s the purchase agreement down the road, the asset purchase agreement or the stock purchase agreement, depending on the structure of the deal. But the LOI lays it all out. And basically what the buyer is saying in that LOI is this I’m showing you what I’m going to do, what I’m willing to do. If you’re agreeable to it, then I need to do my due diligence on your business. And as long as all of that checks out, then I’m going to be ready to close under these terms. And so what’s important about an LOI is because it’s a non binding agreement is not to get overly detailed. I mean, this should be a 1 to 2 page document, in my opinion. All the legal fees and reps and warranties and all of those things that are binding need to be in the purchase agreement, not in the lie.
Jeremy Furtick: So an LOI, in my opinion, the things that really need to be in there are of course the purchase price in the terms, but a timeline that’s really key as well because the seller has got to feel confident that they’re not just indefinitely tied up until a buyer decides they either want to buy it or don’t. So put a timeline in there where you’re going to complete your due diligence, put a deadline in there where you have to deliver the draft purchase agreement and then, of course, put a deadline in there for closing. And and there’ll be language in there that says that it can be extended if both parties agree, of course. And the idea, though, is just to make a seller feel good that you’re not I’m going to give you 30 days to do due diligence, for example. And if if you haven’t completed it by then, then it’s up to me if I want to extend it or not, the timeline. So that’s that’s key there. But as far as your other part of the question about the timing of it, one mistake a lot of buyers make is they think the LOI is what’s going to impress the seller and they may send me an LOI before they’ve even had a conversation on the phone with the seller.
Jeremy Furtick: And I always send it right back and say how present this if you want. But the answer is going to be no because they don’t even know you. And so we need to do some things, some parts of this process to get the seller comfortable with you before you present an offer. Because what that screams to me when somebody sends over in LOI that early is I really have no intention of buying the business based on the terms I’m presenting here. I’m just trying to get the business locked up so that I can evaluate it and then I’m going to come back and say, you know, I offered two and a half million dollars. After looking at the financials, it’s really closer to to what I can do that doesn’t work. I’d rather you spend the time and the effort evaluating the business, then make the LOI proposal, because then if it’s 2 million on the front end in the LOI and using my last example, then if a seller takes it, that’s great. But he’s probably not likely to take 2.5 and then drop it to 2 million. He might be more likely to take 2 million if that’s the original offer. If that makes sense.
Stone Payton: No, it makes perfect sense and I’m really glad that I asked. That is incredibly helpful. All right, man, what’s the best way for our listeners to connect with you if they’d like to have a more in-depth conversation with you or somebody on your team?
Jeremy Furtick: Well, you can call me directly. My office line is 2144426706. You can email me at Jeremy Jeremy at Sigma mergers dot com or look me up on LinkedIn just to search Jeremy FERTIG and you can contact me through there.
Stone Payton: Well, Jeremy, it has been a real pleasure having you on the program, man.
Jeremy Furtick: Yeah, I appreciate the invitation.
Stone Payton: Well, it is my pleasure. All right. Until next time, this is Stone Payton for our guest today, Jeremy Fertik with Sigma mergers and acquisitions, and everyone here at the Business RadioX family saying we’ll see you again on Buy a Business near me.
