We Can Do the Work

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BUSINESS VALUATION UPDATE

TIMELY NEWS, ANALYSIS, AND RESOURCES FOR DEFENSIBLE VALUATIONSVol. 20, No.7, July 2014

Reprinted with permissions from Business Valuation Resources, LLC

We Can Do the Work. The Question Is: Can We Get the Work?

By Rod P. Burkert, CPA/ABV, CVA

While some would likely disagree with the first part of this headline, there is little doubt about the reality of the second for many in our industry. (And, of course, assuming you get the work, how you had to price it is another matter altogether.)

The simple truth is that we have a large body of knowledge that teaches us how to do the work, but very little that teaches us how to get the work.1 Why is that?

Here’s one idea. All of our business valuation journals publish articles based on author-sup-plied content. We read what others submit. Most of what is submitted is related to doing the work because, well, that’s what we do, and these arti-cles build authors’ CVs. When was the last time you read a marketing piece related to getting the work in a BV magazine?2

Back in February, the BVU Editorial Advisory Board (of which I am a member) was tasked with responding to questions about hot topics/trends in our industry. Here’s the list of those questions:

1 Only one book stands out in my mind. Published way back in 1998, Gary Jones and Dirk Van Dyke’s The Business of Business Valuation touched on a few marketing topics.

2 Truth be told, Barbara Walters Price and I wrote “Social Media: Unicorn or Horse for BV Professionals” in the June 2013 issue of Business Valuation Update. The article is about using social media as a marketing tool. I also write a regular column, “Practicing Solo,” for NACVA’s The Value Examiner that mostly dis-cusses practice management and marketing issues for professionals who have started their own firms.

•What do you feel is the most controversial issue today in terms of business valuation theory or methodology?

•What is your impression of the current state of the business valuation profession, and what suggestions would you give to improve it?

•What is the biggest challenge valuation experts face today and what is your advice on meeting this challenge?

•What valuation growth areas do you see on the horizon?

•What is the most common error you see in business valuation analysis or report writing?

•What is your best piece of advice for testify-ing in court?

•What was the last business valuation-related book you read?

•What advice would you give to someone just starting out in the business valuation profession?

The purpose of the questions was to formulate an editorial calendar around which Business Valuation Resources could organize all of its educational offerings in a manner that would accurately reflect the challenges facing industry professionals. Great planning idea! And they are, indeed, great, thought-provoking questions, but

2 Business Valuation Update July 2014

We Can Do The Work. The QuesTion is: Can We GeT The Work?


Executive Editor: Andrew Dzamba Publisher: Sarah AndersenLegal Editor: Sylvia Golden, Esq.Managing Editor: Janice PrescottDesktop Editor: Monique NijhoutCustomer Service: Retta DodgeVP of Sales: Lexie GrossPresident: Lucretia LyonsCEO: David Foster

EDITORIAL ADVISORY BOARD

Business Valuation Update™ (ISSN 1088-4882) is published monthly by Business Valuation Resources, LLC, 1000 SW Broadway, Suite 1200, Portland, OR, 97205-3035. Periodicals Postage Paid at Portland, OR, and at additional mailing offices. Postmaster: Send address changes to Business Valuation Update, Business Valuation Resources, LLC, 1000 SW Broadway, Suite 1200, Portland, OR, 97205-3035.

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BUSINESS VALUATION UPDATE

CHRISTINE BAKER CPA/ABV/CFF

MEYERS, HARRISON & PIA NEW YORK, NY

NEIL J. BEATON CPA/ABV, CFA, ASA

ALVAREZ & MARSAL VALUATION SERVICES

SEATTLE, WA

JOHN A. BOGDANSKI, ESQ. LEWIS & CLARK LAW SCHOOL

PORTLAND, OR

ROD BURKERT CPA/ABV, CVA

BURKERT VALUATION ADVISORS, LLC MADISON, SD

MICHAEL A. CRAIN CPA/ABV, ASA, CFA, CFE

THE FINANCIAL VALUATION GROUP FORT LAUDERDALE, FL

NANCY J. FANNON ASA, CPA/ABV, MCBA

MEYERS, HARRISON & PIA PORTLAND, ME

JAY E. FISHMAN FASA, CBA

FINANCIAL RESEARCH ASSOCIATES BALA CYNWYD, PA

LYNNE Z. GOLD-BIKIN, ESQ. WEBER GALLAGHER

NORRISTOWN, PA

LANCE S. HALL, ASA FMV OPINIONS

IRVINE, CA

THEODORE D. ISRAEL CPA/ABV/CFF, CVA

ECKHOFF ACCOUNTANCY CORP. SAN RAFAEL, CA

JARED KAPLAN, ESQ. MCDERMOTT, WILL & EMERY

CHICAGO, IL

GILBERT E. MATTHEWS CFA SUTTER SECURITIES INCORPORATED

SAN FRANCISCO, CA

Z. CHRISTOPHER MERCER ASA, CFA

MERCER CAPITAL MEMPHIS, TN

JOHN W. PORTER, ESQ. BAKER & BOTTS HOUSTON, TX

RONALD L. SEIGNEUR MBA, ASA, CPA/ABV, CVA, CFF

SEIGNEUR GUSTAFSON LAKEWOOD, CO

BRUCE SILVERSTEIN, ESQ. YOUNG, CONAWAY, STARGATT &

TAYLOR WILMINGTON, DE

JEFFREY S. TARBELL ASA, CFA

HOULIHAN LOKEY SAN FRANCISCO, CA

GARY R. TRUGMAN ASA, CPA/ABV, MCBA, MVS

TRUGMAN VALUATION ASSOCIATES PLANTATION, FL

KEVIN R. YEANOPLOS CPA/ABV/CFF, ASA

BRUEGGEMAN & JOHNSON YEANOPLOS, P.C.

TUCSON, AZ

most of them deal with the technical aspects of our work.

The problem, as I see it, is that the questions miss the undercurrent of a larger dilemma in our industry. Want proof? In the 2013 FVS Membership Top Issues Survey, the No. 1 prac-tice issue was “bringing in new clients.”3 Eighty-seven percent of the survey respondents thought this issue was either “somewhat important” or

“extremely important”; 63% of respondents said the issue was “extremely important.” Here are the top five issues from that survey:

1. Bringing in new clients;

2. Retaining qualified staff;

3. Retaining clients;

4. Fee pressure/pricing of services; and

5. Differentiating the firm through services.

Where are the articles, webinars, and toolkits to help these people? What good is serving up only content related to doing the work if you can’t get the work?

Now compare the 2013 issues to the top five cited in the 2010 survey:

1. Keeping up with professional standards;

2. Keeping up with the evolving valuation body of knowledge;

3. Bringing in new clients and retaining clients;

4. Developing a niche or specialization; and

5. Gaining access to specialized training.

3 2013 FVS Membership Top Issues Survey: The Top Five Issues Facing Forensic Valuation Practices, pub-lished by the AICPA Forensic and Valuation Services Section.

July 2014 bvresources.com 3



Only No. 3 is not related to the technical side of the business, though it can be argued No. 4 might have a shade of “getting the work” to it.

The shift in perspectives is seismic. How did we get here?

Looking back. First, look back over just the past few years. The economy was/still is (your pick) in shambles, creating financial and operational issues for businesses that relegated some valua-tion needs to a back burner. The fear of onerous changes in estate tax law led to a tsunami of gifting business interests in 2012-2013 that many of us almost drowned in. Now, the gift/estate

Top Ways to Build a BVFLS Practice1. Find a niche and position yourself as a thought leader in it. Be known for knowing your stuff.

2. Communicate your expertise. Make speaking or writing (or both) a personal strength and create content that solves the problems of your ideal clients.

3. ABC (Always Be Connecting). Do this with current and prospective clients, colleagues, and referral sources because you never know where the next lead will come from.

4. People do business with people they know, like, and trust—and can find! A killer profile on LinkedIn and presence on other social media platforms can help when the barriers of physical location and time zones are crumbling.

5. Take the time to work on, not just in, your busi-ness. For example, envision your successful prac-tice X years from now. Who are your aspirational clients and referral sources? What are you doing to attract them?

6. Take well-hedged risks. Nothing exciting happens in your comfort zone.

7. Remember Zig Ziglar’s golden rule of selling: “You will get all you want in life if you help enough people get what they want.”

Source: Practice Builder Academy (practicebuildera-cademy.com). This is a 12-month mentoring program that teaches proven strategies to BVFLS professionals who want to build their practices and redesign their lives.

valuation pipeline is dry. Fair value and 409A have not turned out to be the full employment acts for appraisers that many thought/wished/prayed they might; grumblings about pricing and outsourcing are abundant. And we may have created more generalist practitioners than the industry currently needs.

With a longer look-back period, the problem appears even more structural. Let’s face it, in college most of us took accounting, finance, and economics classes because that’s what we needed to start on the path of becoming techni-cally proficient in our careers. Who took market-ing classes in college? And even if you did, how did they prepare you for the nimbleness needed in today’s digital, connected economy?

When I started doing business valuations in the mid-1990s, one of the things I admired most about some of my instructors and colleagues was their competence in making this work a full-time gig. It’s not that I didn’t respect their tech-nical chops—I considered that to be a given. But the ability of these people to have their own BVFLS practices or run BVFLS practices for larger (mostly accounting) firms was just really cool. How were they able to do that?!

Yet just a few years later, starting with a handful of referral sources, I clawed my way into the ranks of the self-employed practitioners. But frankly, the BVFLS life was simpler and easier back then, and I think most of those who have been around since the mid-1990s would admit to that.

Current woes. Fast-forward almost 20 years to today. Running a practice is more difficult than ever. There is more competition. (As a long-time NACVA instructor, I helped create it!) Everyone is scrambling. Fees are being squeezed. And, instead of invigorating their lives, I see the prac-tices of many of my friends and colleagues draining their energy. Working harder for less profit and joy was not in anyone’s business plan.

All of this is why Mel Abraham and I created Practice Builder Academy, a predominantly

4 Business Valuation Update July 2014



marketing-focused program for BVFLS practi-tioners. When we launched PBA, we did so via a series of webinars. Webinar registrants were asked to complete a survey that we thoughtfully crafted. About 250 people participated in the webinars and 75 responded to the survey, a 30% response rate. Here are some demographics:

• 65% had more than five years of BVFLS experience;

• 64% geared their practices toward busi-ness valuation;

•44% had one to two employees in their firms;

•47% spent one to two hours per week on marketing;

•73% were not using social media to grow their sphere of influence;

• 51% said they did not have a practice niche;

• 66% said they were not recognized experts in a practice area; and

•72% said they would practice for at least 10 more years.

We asked some subjective questions, too, for example, what they liked and didn’t like about their jobs. Not surprising, many respondents loved doing the valuation work—analyzing the data and understanding the puzzle presented by the engagement. Equally not surprising, people had a strong dislike for administration, time and billing, and, of course, marketing.

We asked what was the biggest challenge they faced in building/growing their practices. Almost all of the responses centered on the theme of getting the work in the door. More than a few people said they have been trying to grow their practices for more than 10 years. While their tenacity is admirable, it’s sad that so many are still trying so hard to get work.

Look, we’re business appraisers. We’re supposed to understand the concept of value. Normally, we do this in the context of a business or business interest, but how often do we apply the concept to ourselves. What is our business value?

Back in the day, I was the partner in charge of the valuation practice for a regional accounting firm. I remember hearing the managing partner say: “I can always find people who can do the work; the problem is finding people who can get the work.” The aphorism wasn’t lost on me: Technicians have value; rainmakers have more.

What’s a practitioner to do? I believe we need to take personal responsibility for our state of affairs. We need to allocate some of our CPE hours to the “softer side” of business: creat-ing and getting work. We need to hook up with programs that provide marketing education and psychology, too (understanding how and why people make buying decisions is incredibly valu-able in our physical and online worlds). We need to recognize that money spent in this endeavor is an investment, not a cost.

We also need to request that valuation publica-tions devote more column inches to developing new business. We need successful profession-als to share their secret sauce for getting work (see the sidebar for some of this). We need to support the creators of this content by showing up when it’s presented because the status quo is not helping practitioners where they are telling us they need it most.

Rod P. Burkert, CPA/ABV, CVA is the founder of Burkert Valuation Advisors LLC, a business valuation and litigation support firm. Rod is a long-time instructor for NACVA’s Consultants’ Training Institute and was recently re-elected to NACVA’s Executive Advisory Board. He is also a member of the Business Valuation Update Editorial Advisory Board. Rod has built a mobile consulting practice that allows him to travel full time in an RV throughout the United States and Canada with his wife and their two dogs.

We Can Do the Work

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