Lowell Capital Management’s Post

Most business owners don't believe that owning a business is riskier than a diversified portfolio. This is because of the illusion of control - we believe we can mitigate potential disasters of our own business, but feel out of control when investing in stocks. Owning a business is like putting 80% of your investment portfolio in one stock with no intention of diversifying through the conventional methods that we, as index investors, use. As you grow your business, be cognizant of the risk inherent in your business and consider creative, company-specific methods of diversification to mitigate risk. Learn more here: https://lnkd.in/e79ATFh9 #BusinessOwnership #FounderStory #SCBusiness #GrowthFinance

“Our acquisition preferences run toward businesses that generate cash, not those that consume it… However attractive the earnings numbers, we remain leery of businesses that never seem able to convert such pretty numbers into no-strings-attached cash.” Warren Buffett At Lowell Capital Value Management, we are highly focused on future cash flow as it is a fundamental determinant of intrinsic value. #LowellCapitalValueManagement #freecashflow #valueinvesting

How much is your business worth? Increasing the value of your business can only start from an accurate understanding of its current value. 🎯 Once you understand that its a logical step to look at the factors underpinning the valuation, and to see what has to be done to increase your number. Whether you’re looking to retain and grow the business, or progress towards a successful exit this is the foundational step. And if you’re ever planning to exit the business it is better that you start this 2-5 years before you want to transact the sale, in order that the value can be maximized. We can help both with a detailed valuation of the business, and building and delivering the strategy to maximise it. Drop me a note today if you’d like to take the first step. 👣 💰 📈 🏆 #businessvaluation #growthhacking #investment #businessexit

A CEO has five main options for allocating a company’s capital to maximize shareholder value: (1) investing in current business operations, (2) acquiring other companies, (3) repaying debt, (4) paying cash dividends, and (5) repurchasing shares. To achieve these, the CEO can use three resources: cash flow from operations, borrowing, and issuing shares. Although this seems straightforward, the long-term benefits to shareholders significantly depend on the CEO’s decisions on how to use these capital tools and for what purposes. Essentially, capital allocation is about making investment decisions with the company’s resources. Therefore, CEOs need to be not only good managers but also skilled investors.

You’ve built your business from the ground up and know it’s set to keep growing. But how can you convince an investor of this incredible potential? By citing numbers to tell a compelling story. Private equity (PE) firms are some of the biggest players in the M&A field, but they have one goal: quickly making a large ROI. To invest, they must believe that your business will multiply in value within three to five years. So develop a credible growth plan! Step 1 is figuring out who and what will drive your company’s growth. Is it new or existing customers? New or existing products and services? Once you understand these drivers, it’s time to demonstrate why your forecasts are to be believed. PE firms will want to see historical financials. They’ll also carefully evaluate your projections and the assumptions on which they are based. If your growth plan is convincing, you have a valuable tool to capture PE interest. Have you ever created a credible growth document? Leave a comment about how it affected your M&A experience. #M&A #GrowthStrategies #BusinessOwner #Funding #PrivateEquity https://hubs.la/Q02Ffn7J0

80% of a successful strategy is just about: Capital allocation. Where can you allocate capital with the highest return on your investments You can: 💰 Reinvest in your business - Strengthen your core to invest in product/service improvements to protect your market share; - Invest in adjacent and transformational ideas with higher returns on capital to keep your business future-proof. 🤝 Invest in M&A - Fuel the growth of your core reinvestments by buying other companies 💸 Payout dividends If no other opportunities exist to return higher percentages on your investments, you can reward your shareholders directly. 🔄 Share buybacks - Shows confidence in your business and increases the price of your shares. 📊 Strengthen your balance sheet Pay off debt and improve your stability - Don't create unicorns, Let's breed blue whales. 🐋 #innovationmanagement #innovationstrategy #businessinnovation #corporateinnovation #businessbuilding #venturebuilding

What is one of the biggest drivers of a company's future success and long-term shareholder value creation? We believe it is a company’s ability to effectively prioritise and deploy capital. With this in mind, we strongly believe every business should have a capital allocation framework that can be clearly articulated and understood by investors. James Revell dives into what makes for an effective capital allocation framework, the key levers for driving free cash flow per share and importantly gives insight into what “best in class” looks like when it comes to communicating this to investors. https://lnkd.in/djSujhyY

Unlock the full potential of your business with expert equity valuation services! Discover how strategic shareholder growth can elevate your investment in our latest blog post. Dive into actionable insights and tailored solutions designed for SMEs, and learn why understanding your business's true worth is the key to success. Don't miss out on transforming your business strategy. Read the full article here: https://lnkd.in/gUCN-7fn #EquityValuation #ShareholderGrowth #BusinessGrowth

"More companies die of indigestion than of starvation..." It's easy to think that most businesses fail due to a lack of capital or sufficient finances, but the reality is that the majority of businesses go under because they weren't able to efficiently deploy (digest) the capital that they did have! 💰 There is a fine line of not having enough capital versus having it and just not deploying it efficiently! #CoolHollowSolutions #BusinessConsulting #Capital #Growth #Finances

For most business owners, your company is your largest asset! It is important to ensure it is being managed correctly and sometimes the business owner can get bogged down by the day to day responsibilities, that they lose sight of the overall vision, direction, & finances of the business! Cool Hollow Solutions is here to help manage that asset so you can focus on what you want to within your business! 🔥 #CoolHollowSolutions #BusinessConsulting #Management #Asset #Finances