kasteellaan 160 | b-9000 gent | be 0426.851.666 | rpr gent | tel. +32 9 224 43 60 | fax +32 9 224 01...
TRANSCRIPT
Kasteellaan 160 | B-9000 Gent | BE 0426.851.666 | RPR Gent | TEL. +32 9 224 43 60 | FAX +32 9 224 01 69 | www.dvn.be | [email protected]
When I’m 64
InterDirect Networksept 2010
Georges Van Nevel
Kasteellaan 160 | B-9000 Gent | BE 0426.851.666 | RPR Gent | TEL. +32 9 224 43 60 | FAX +32 9 224 01 69 | www.dvn.be | [email protected]
Succession planning or
the next generation
Background
● Some day, we will all retire.● You think you’ve worked enough.
Key issue
● What to do?
Selling
● To a third party● To the kids● To the other management members
Trends
● Sector fragmentation◦ Smaller agencies◦ Importance of freelance groups
● The role of procurement and financial people: ◦ Fee and price pressure
Trends
● Marketing is becoming increasingly marginalised in big companies. Even more in smaller countries.
● Networks are concentrating on BRIC-countries and on-line.
● China: they have the tangible stuff, but they don’t have the brands.
● Converting communication into a commodity.Split-up of the jobs.
Trends
● Digital/social media are our core business.● Software as a commodity tool in the digital world.● Private equity offers other opportunities.
Conclusion
• It’s a new world.
Selling to a third party
●Networks●Private equity●Private individuals as sleeping partners
Selling to the kids
●Do they have the know-how and the skills?●Integration within the existing
management team.●Your other kids.
Selling to the management team
● Are they willing to invest?● Do they have the money or the capital sources?
New trend
● A mix of shareholders. ● The previous owner becomes sleeping partner.● Other parties concerned become shareholder (eg
printer, software developer, holding, …)
Rating methods
● Based on historical performances.● Discounted Cash Flow method (DCF).● Earn out:
◦ Based on growth◦ 3 – 5 years◦ Multiplier influenced by certain criteria
● Importance of continuity● Value ≠ price
Model
● Old situation
Selling price: 1.000Owner 1: 600Owner 2: 400
Owner 1 Owner 2
Agency x
60% 40%
Model
● New situation alternative 1
Owner 2 Owner 3
NewCo
Owner 4
Agency x
60% 20% 20%
100%
Model
● New situation alternative 2
Owner 2 Owner 3
Agency x
Owner 4
60% 20% 20%
● Capital: 400◦ Owner 2: 240◦ Owner 3: 80◦ Owner 4: 80
● Bank loans: 600
New financial situation
● The way it used to be:◦ 20/80
● Nowadays:◦ 30/70◦ 40/60
Trend
● 5 – 7 years
Payback period
My interest is in the future, because I’m going to spend
the rest of my life there
Thank you