As I now mark the one-yearanniversary of commencing this syndicated column, I hope no one willmind if I use this occasion to talk about my new book, “BusinessExit Planning: Options, Value Enhancement and TransactionManagement,” published by John Wiley & Sons, available onAmazon and other retailers. This book is very timely from a CentralEuropean perspective, where numerous businesses were founded orprivatized in the early 1990s, and the original owners are preparingto pass the torch to the next generation, or the next owner.

The book is designed toprovide owners of mid-sized businesses with the knowledge required tocarry out a transaction for the first time, whether it is attractingfresh equity, finding a strategic financial partner, or selling aminority or majority interest in a company. Often this requires aparadigm shift on the part of business owners.

It covers two majorsubjects:

• Business Exit Planning: Selling your business is not the only option. There are many others to consider, such Management Buyout, Initial Public Offering, or inter-generational transfer (passing the business to your children or next-of-kin).The pros and cons of each option are discussed in some detail. How should a business owner establish objectives? Can you forecast the valuation of your business? What is the best moment to begin the sale process? How might you enhance the valuation of your business before transferring ownership? How can corporate governance affect the value of a business?

• Transaction Management. What are the steps to a transaction? What can the business owner expect at each stage? What are the core competencies required; will you need outside advisors? How should you organize and manage your team? What kind of a process should you run? When should you grant exclusivity? How do you keep the process confidential? When should you tell your staff?

There are three key themesto the book:

1. A Business Exit shouldnot be a spontaneous process, but the result of careful planning.Planning needs to cover everything from planning retirement, taxplanning, what will be done with proceeds of sale. Part of thedifficulty for business owners is the multidisciplinary nature of theplanning effort.

2. Business owners tend tounderestimate the preparation and time required to exit. Mostbusiness owners begin negotiations long before they are truly ready.

3. There is often amismatch in negotiation strength between investor and seller. Forbusiness owner doing a first transaction, facing a professionalstrategic or financial investor who has often done dozens oftransactions, is no easy task. This may often be remedied byappropriate preparation and selecting the right moment to take acompany to market.

Lack of business planningis not an isolated problem; it is something of an epidemic, being amajor contributor to the number of bankruptcies in most countries.According to official statistics, one third of bankruptcies in theUK, for example, are caused by lack of succession planning. Eachyear, many thousands of businesses self-destruct. While Schumpetermight argue that “creative destruction” is a normal part of thecapitalist system, this type of self-destruction of businesses isusually entirely avoidable with sufficient advance planning. And thatwould have massive implications for employees and families ofbusiness owners.

This book is an updatedversion of my earlier edition, “Unlocking your Company’s Value.”It is currently under translation into most Central Europeanlanguages (Polish, Czech, Hungarian, Bulgarian, Serbian, Albanian),appearing later this year in these languages. Negotiations are underway with publishers in Romania, Croatia, Turkey and Greece.