Private Equity
Blue Sky Capital Resources Insights - Why Are The Low Hanging Fruit Not Being Picked?
October 2019
The majority of valuations that come across my desk, bring to light obvious areas of opportunity for business owners to make improvements and over time increase the business value, otherwise known as the low hanging fruit. However, who are these areas of opportunity obvious to? The business owner? The valuator? A potential buyer?
It’s all about what perspective you are coming from.
The Business Owner. A business owner, in the lower middle market, generally wears multiple hats. Managing daily operations, quoting bids, hiring employees, going client’s offices, etc. They work in the business, are generally the go-to person for any issues company-wide, and hold the key relationships with the clients/customers. The business owner is so busy working in the business they may not realize the low hanging fruit even exists. “A wealth of information creates a poverty of attention,” economist Herb Simon warned in 1971 and this is even more true today with the ever increasing access to data at our fingertips.
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