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CEO Advisor® Newsletter
February 2019
CEO advisor Advises Rhythm Interactive on its Strategic Acquisition

CEO Advisor®, Inc. (www.CEOAdvisor.com), a leading business consulting, growth capital and mergers and acquisitions advisory firm in Newport Beach, CA, advised Rhythm Interactive, Inc., a full service digital agency in Irvine, CA on the sale of the business to Code and Theory, LLC, a New York based digital agency.  Code and Theory is a subsidiary of Stagwell Media, LLC of Washington, DC, which invests in advertising, research, analytics, public relations and digital marketing services companies. 

Rhythm Interactive, located in the Irvine Spectrum area and central to Southern California, provides a broad range of digital agency services to meet the needs of corporate customers in the Western United States.  Craig Cooke, CEO of Rhythm states, "Mark Hartsell has been our business advisor for several years and we were extremely prepared going into the sale process.  His expertise, organization skills and experience were instrumental in securing the right buyer, expeditiously performing due diligence and advising us through the closing.”  Pete Bohenek, President of Rhythm adds, “This strategic acquisition by Code and Theory is a true win-win and we are extremely excited to be part of their team.  It is the perfect fit and we will continue to operate as Rhythm as we have done for the past 23 years."

As trusted business advisors since 2004, CEO Advisor, Inc. provides a hands-on, disciplined approach to working directly with CEOs, presidents and business owners of small and mid-market companies.  We advise CEOs by focusing on growth, business strategy, planning, growth capital and mergers and acquisitions advisory services to grow their businesses to the next level, while increasing shareholder value for their optimal future exit.  

Mark Hartsell, President of CEO Advisor, Inc. states, “Rhythm is one of the fastest growing digital agencies in Southern California.  They have the expertise, strong management and professional approach that sets them apart in the Southern California market.  Rhythm’s growth, coupled with their extremely high quality clients, are a result of their deep expertise in web applications, analytics, design and digital marketing services.  With the acquisition by Code and Theory, there is no limit to their future success.” 

About Rhythm Interactive
Rhythm provides a full range of web and mobile applications, digital infrastructure and integrated marketing solutions for mid-market and enterprise companies.  Rhythm’s in-house team is located in Irvine, CA in the heart of Southern California. The company services multiple market segments with a focus on the healthcare, real estate, manufacturing and automotive industries.  For more information, contact Rhythm Interactive at (949) 783-5000 or visit www.RhythmAgency.com.

  
About CEO Advisor, Inc.
CEO Advisor provides business consulting, growth capital and mergers and acquisition advisory services to effectively meet the specific needs of small to mid-size companies in a wide range of industries, including software, technology, media, printing, professional service firms, healthcare, manufacturing and many more.  CEO Advisor's mission is to advise CEOs, presidents, business owners and principal executives with the needed expertise and focus, coupled with hands-on advice to grow your business to the next level and realize your life’s dream through a successful exit. Contact Mark Hartsell, MBA, President of CEO Advisor, Inc. for a no cost initial consultation at (949) 629-2520, by email at MHartsell@CEOAdvisor.com or visit us at www.CEOAdvisor.com for more information.
Source: Excerpt from the Philadelphia Business Journal, Aug 9, 2018
I'm a big believer in career advisors. For one thing, they help drive measurable and positive outcomes. That's clear from a wide range of studies over many years on the subject. Advisors, coaches, mentors - however you label them - have been found to improve competitiveness and leadership development.
A review of 25 years' worth of research on mentoring, published in the Journal of Vocational Behavior, found mentors "improve career outcomes for individuals. My own experience confirms all these findings." 
The type of relationship or counsel you are looking for also evolves over time. Ironically, many people abandon these sorts of partnerships as they climb the corporate ladder. They feel they can go it alone, but I am a firm believer in leadership under advisement. 
Early on in my career, I sought out coaches or mentors. As I rose through the executive ranks, and especially as a CEO, the stakes became higher and I sought out trusted advisors - individuals who sat outside of the organization that I could safely and confidentially bounce ideas off of and get insights from, in addition to my management team. These people continue to round out my thinking and help me navigate through challenging situations, prioritize opportunities, and improve performance.
When it comes to advisors, the duration of the relationship is an important factor. There can be people in your professional life who make a distinct impression. A great orator, a wise elder, or a paid consultant that gives you sound advice.
But, in my experience, when it comes to making an indelible mark on your career, finding a person who you implicitly trust, who truly understands your strengths and weaknesses, who pushes you to be accountable, who you are willing to take constructive feedback from, and who can be a thought partner - well, that doesn't happen overnight. That builds gradually and requires investing time and energy and deliberation. It's a relationship where there is no agenda other than making you the best you can be and reinforcing it through remarkable results.
I've been fortunate to have several long-time advisors. One of them has been working with me for many years as an executive coach. His role at that time was to help us think through executive leadership, transformation, and value-driven outcomes. I remember one of the first things that struck me that he was a "strategy guy," with strong business acumen and a hard drive for accountability and results. 
He asked thought-provoking questions, always pushed for more, challenged the status quo and was all about partnering to achieve the best outcomes for the organization. As a senior executive in the company, I quickly came to value him as a resource to help think through some of the complex issues we were facing. The relationship evolved to trusted advisor.
His experience is diverse. He was a Marine Captain and has worked for a range of Fortune 100 companies, such as Pepsi, GE and Citigroup, as well as smaller companies, including a recent one in the medical devices industry where he led the build-out of a top-tier domestic and international organization. His vast experience across a variety of highly competitive industries informs his keen insights, intuition and advice on business and cultural issues - all of which have been invaluable to me. 
While nothing fully prepares you for the challenges of being a chief executive, having a business advisor when the going gets tough or to just to be a thought partner is an enormous plus. Our always-evolving, never-ending agenda is building "a remarkable organization" and keeping it remarkable as dynamics change. 
Very few companies consistently outperform over long periods, so setting out to do so means you have to strategically beat the odds. It's a fluid and complex process - you have to get the right team and culture in place, set forth a clear strategy that the team can execute against, establish goals with measurable outcomes, and learn how to navigate and best serve a diverse group of stakeholders with different agendas. 
As time goes on and new opportunities and challenges constantly present themselves, organizations and cultures need to be rethought and assessed. It's important to have someone who is not ingrained with the day-to-day team, that you trust, to help you think through these issues, challenge you, and provide critical insight.
I'm enormously grateful for the impact my business advisor has made - and continues to make - in my professional growth as a trusted confidante. I now take elements I have learned from him and use it with others who are looking to grow as leaders. Whatever stage you're at in your career, make the time to cultivate a trusted advisor. 
CEO Advisor, Inc. has 38 years of advising some of the most successful CEOs and business owners of companies in the Southern California area. Contact Mark Hartsell, MBA, President of CEO Advisor, Inc. at (949) 629-2520,by email at MHartsell@CEOAdvisor.com or visit us at www.CEOAdvisor.com for a no cost, no obligation initial consultation today.
7 Ways CEOs Can Continuously Improve Their Performance 
Continuous improvement is vital to performing optimally as a CEO. The best ones make time for it, because they see it as an investment in themselves and their company that will pay off in real dollars now and down the line. So what specifically can you do as a CEO to improve your skills and performance? Here are 7 ways. 
1) Attend Training Programs: For the past several years I have given an annual seminar on the CEO position. The biggest excuse I hear from CEOs for not attending is that they don't have time. From my experience the CEOs who do attend are typically the ones who are already better than most. Because of this, they know how to make time to improve their skills. If you think you don't have time to get better at your job, then you are not doing your job properly.
2) Read Books: CEOs who take the time to read about the experiences of other chief executives and other business leaders have an advantage. While the advice may not be perfect for every situation, I can tell you that I almost always come away from reading a top-rated business book with a couple of ideas that make a difference in my businesses.
3) Write Some Content: Writing forces you to clarify your thoughts in a way that is highly beneficial for future action. Taking the time to write a regular email to your company explaining your thoughts and actions can do a lot to improve your thinking as well as align the team with your vision. Many CEOs have begun a regular blog to comment on issues they find interesting. Formalizing your writing schedule will pay big dividends as a CEO.
4) Meet with Wise People: As a CEO it is part of your job to find people from outside your company who can bring knowledge and experience to bear on your problems. Make an effort to get to know people in your community who have relevant experience. Seek out the other leaders in your industry to establish relationships. Many times the relationships I formed within my industry provided tremendous value to the company.
5) Study Yourself: Learning about yourself, how you think and react, is critical to developing as a CEO and overcoming your internal biases. There are many different self-assessments tools available - from Myers-Briggs to Marcus Buckingham and Donald O. Clifton's strengths-based assessment. Many firms specialize in this area and may offer a free interpretation of your results. If you find one you like, extend it to your employees so you have a common language to address personality issues across your entire team.
6) Gather Feedback: If you are not getting feedback about your performance, then you have a problem. It is not enough to just ask for feedback and hope it comes to you. You should actively solicit feedback both from your employees as well as your board or outside advisors. Getting feedback from employees will often require an anonymous feedback mechanism or third-party gatherer. Feedback from your board should be both informal and formal as well as on a regular schedule.
7) Seek out Mentors and Advisors: Reach out to those who have gone before you to gain from their expertise and experience. The CEO job is unique, so make sure you have people in your circle who have been in the chair and know the challenges of the job. Avoiding lost time and missteps converts to big dollars in your pocket.
If you are not improving your knowledge and experience, you are letting the company down. Don't be the CEO who keeps doing the same things over and over and wonders why he/she doesn't get different results.
To learn how to achieve better results, accelerate sales, increase profits and increase shareholder value, call Mark Hartsell, MBA, President of CEO Advisor, Inc. at (949) 629-2520 for a no cost initial consultation. 
5 Mistakes to Avoid When Selling Your Business
Proper Execution can Add Millions of Dollars to your Value

Many small and mid-size business owners make major mistakes when selling their business and it costs them millions of dollars in the process. Without the proper expertise and execution, your hard work and long-term investment will be greatly diminished. These mistakes are often easily avoidable. As entrepreneurs, many dream of building their business to a big success - to reap the rewards in the form of a successful exit. But planning for and conducting the sale is not as easy as it may appear.

As a former CEO of a software company myself, I have built and sold businesses over the past 35 years including mergers and acquisitions management positions for Corporate America, as well as mergers and acquisitions advisory services for the past 15 years for my own firm, CEO Advisor, Inc.

Here are my five tips to help you avoid business sale pitfalls, missed opportunities, lost money and possibly having the perfect buyer slip through your fingers altogether.

Mistake 1: Not Planning Ahead or Waiting Too Long to Sell
Not planning in advance and especially waiting too long, can cause many business owners to miss their window of opportunity. It takes 6 months or more to sell a small to mid-size business. Planning is key to any successful business sale. You just never know when that perfect buyer will call you and is ready to make you an offer you can't refuse - if only you were prepared!

Mistake 2: Not Finding the Right Person to Represent Your Business
For continuity purposes, the same individual in the advisory firm that helps you with the preparation for the sale should be the same person and firm that sell your business. Otherwise, this can cost you a lot of time and money in the long run. Without this continuity of knowledge of your business coupled with the needed expertise, you may see no results and have to start the process all over again.  Make sure to choose - and continue to work weekly - with a very seasoned, experienced business/M&A advisor.  Make sure not to get passed onto a junior person, or have a junior person work on your sale behind the scene. This will be a disjointed and very costly situation that may not result in a sale at all.

Mistake 3: Asking Too Much or Too Little for the Business
Valuing your business at a very high or unrealistic minimum price for a business can destroy your chance to secure a buyer. Expecting to get top dollar for a business that generates little profit, has low Gross Profit Margin or has slow growth is simply bad business. Consider the size and health of your industry, comparable businesses, the economy, size of your business, growth rate, Gross Profit Margin, Net Profits, strength of your products, management team, and other factors when determining your value in preparation for a sale.

Another mistake is to value the business too low. Often business owners will price their business low because they are burned out, suffer from an illness or did not get good advice. Do your homework and listen to your business/M&A advisor. Review and assess your research about other business sales and make prudent decisions to optimize your sale price and increase your odds of a successful sale.

Mistake 4: Not Being Engaged in the Sale at the Proper Time
Selling your business will take a team of a business/M&A advisor, a corporate/transaction attorney and a CPA/tax advisor.  Your M&A advisor will lead and manage the process but don't underestimate the time and focus it will take for the entire sale process.

Mistake 5: Taking the Wrong Offer or Buyer
Evaluate your options and make the best selection for the long term. Ask yourself, is this the best company to buy and operate my business? Can they quickly connect with my customer base and learn how to market effectively? When the business sale goes as planned, it creates a tremendous opportunity for both businesses. Part of the sale price may be a future Earn Out and you need to stay engaged, work with the buyer and continue your success as a team.

Contact Mark Hartsell, MBA, President of CEO Advisor, Inc. at (949) 629-2520, by email at MHartsell@CEOAdvisor.com or visit us at www.CEOAdvisor.com for more information or to schedule a no cost initial consultation at your office.

Testimonial  


"Over a one year period, Mark helped me to understand what my role entailed. Together, we segmented my numerous headaches into achievable goals. I learned to focus on specific issues and predict obstacles by looking at my business in monthly and yearly models. Mark taught me how to understand financial reports as well as the implication of spending. I now understand how to measure the performance of my company and profitably grow my business."


CEO, Web Service Company

CEO/President, Engineering Services/Manufacturing Company


Whether it is growing a business to the next level, turning a distressed company around or preparing a company for an exit, Mark's firm, CEO Advisor, Inc, provides a broad range of services and Mark is there for the CEO every step of the way."

 


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Haynes & Boone, LLP

Words of Wisdom


"True leaders are the first to admit that they don't know everything and that they need help."

Bill Byrd
Author of Sweet Success: 12 Proven Habits of Winning Leaders