The Northland 1MC Presentation“The Re-Start Up of a Company”

Entrepreneurs are not only the folks in

The Freight House District Who Develop a

Mobile App

Compass

Small Business Success is a Journey, But for the Journey I needed a Compass

A/P Cushion

Introduction to Exhibit Associates

• Great Foundation– 34 Year Old Company– Original Owners looking to retire– Great Customer Base– Unique Product Offering– First Customer is still a customer– Tenure is 14 years

• Google Results = Zero ww

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Great Customer Base

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Products, History and Room for Improvement

Not Just Tradeshow Booths

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But Tradeshow Services As Well

• Start Up or a Re-Start Up have the Some of the Same Concerns;– Idea – Is there a market?– Funding – Where can I get it?– Revenue – Will it be enough?– Customers – Can I acquire (keep)?– Team – Can I build (keep) one?

Start UpRe-

• Idea– Tradeshow Business– Perm Installs

• Funding– UMB Bank– Investors

• Revenue– Flat since 2008

• Customers– KC Who’s Who– Long Term

• Team– In Place

– Is It “Circling the Drain”?

– Business Plan & Loan Committee?

– Payback?

– Can I grow it?

– Seller’s Leave – Then What?– Afraid of “New”?

– Key People Conflicts?– Can I fit in the existing culture?

Start UpRe-

Transaction Process

• Got A Lawyer• Went Bank Shopping– UMB Bank

• Studied the Industry• Looked at the competition– Locally– Nationally

• Who where the giants?– Is there a Netflix to the Blockbuster?

• How did they get there?

Transaction Process

• What I did not realize– I had the Money – I should have Owned the

Transaction• The business was not the only business in town

– I had become attached to the business• Pitched the Bank• Pitched the Investors• Pitched My Family

• Like a Start Up, A Re-Start Up Leader has to have belief and Faith

Day 1: Let’s Go!

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Product & Services DefinedExternal Team Members On Board

Industry Studied

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Exhibit Associates Key Team Members On Board with New Plans

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www.techexpressonline.com

IT and Office Re-Built

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MBA 101

Internal Process Upgraded

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Projects in First 24 Months

Day 383: Warehouse Floods

Day 381: Salesman QuitsFind out he has been referring business elsewhere

Day 380: Slowest Tradeshow Year in Seven

Murphy Worked Overtime in October 2013

But there was other things just not right

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Insanity

• Short on Cash Over and Over– Added Additional Money

• SnapShot Numbers– A/R, Bank Balance, A/P Fixed, A/P Job, AMEX

– Numbers but no tools

• Vendors Calling– Hated the Phone

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“Numbers to Manage”Data But No Information

Collected Data about Operations

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Developed The Well

“Dig your Well before you are

Thirsty”

Developed/Maintained Relationships With banks, VC firms and private investors

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Developed The Well

• Went to the Bank for More Money– Balance Sheet & Income Statement• No Leverage equals No More Money

• Went to Existing Investors– Need to see a “Way Forward”

• Sought New Investors– Crickets

• Candid With Customer

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Needed a Way Forward

• Divided the Business into Three Levels:– Cash• What Where When How Why

– Reporting• Great Plains Dynamics• Useless & Cumbersome

–Management• Long Term• Strategic Planning

Actual Cash Flow

Accounting Perspective

Managerial Perspective

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Started a “Way Forward”

• Action Items– Called the Vendors– Reduced Expenses• People

– Sales Focused• Already Rebuilt the office• Already Rebuilt the IT Infrastructure• Already Documented Processes

» Ongoing

Day 436: Finding the Compass

From Slide #3:Small Business Success is a Journey,

But for the Journey I needed a Compass

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Monthly Expenses

Started with the Basics

Threw Them on A Calendar

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A/P Cushion

And Not Passing a chance to Make a Spread Sheet – put the Monthly Expenses, and A/R in a Spreadsheet

The Compass Showed Up

Green Is Revenue/ Capital

Red is Expense

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Bank Balance + A/R - Monthly Expenses

A/P Cushion=

Usually Done Every Weekend and Forecasted Out to 60 Days

Key Economic Activity MetricOr “Compass”

Say on Sept 1st A/P Cushion for Nov 1 = $100,000.00Then on Sept 15th A/P Cushion for Nov 1 = $150,000.00

Then Exhibit Associates has generated $50,000.00 of Economic Activity in 15 Days

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Current ForecastA/P Cushion*

A/P Cushion is how much we can spend on Variable Costs

* - Numbers are not Actual

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RollerCoaster 24 Months

• Excitement of Re-Starting a Company• Great Product and Services• Harsh Reality of running out of Cash• Once stabilized through turning data

into information able to manage the company effectively

• Looking forward to the 24 months

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Things That Went Well in 24 Months

• Learned a Lot–Met with the Customers–Met with the Vendors–Went to Industry Tradeshows–Worked with The Team• Asked Questions• Drank Beer• Worked side by side• Recognized their expertise

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• Product Mix Was Good– Banner Stands– Backwalls– Booths– Perm Installs

• Foundation Was As Good As Expected

• Culture Fit Worked!

Things That Went Well in 24 Months

Transactional Lessons Learned

• Should have Developed a “Go/No Go” Checklist– Profit– Revenue– Customer Mix– Product Mix

• Should have Reviewed The Procedures• Should have Reviewed The Process Maps

Transactional Lessons Learned

• Should have Viewed the Sellers as the Enemy– Spoken to them about it – Not personal – just business– Sellers had Check Out of the Business

• They were emotionally involved in “after”

– “Trust but Verify”• Should Have Not Gotten Attached to the

Business– Impossible after pitching the bank, the

investors and the family

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Transactional Lessons Learned

• Should have “Dated” The Company– Equipment– Hardware • PCs – How Old?• Servers – How Old? How Much Space?

– Software • Licenses – When Do They Expire?• Versions – How Far Out of Date?

Transactional Lessons Learned

• Should have Used My Team More– Lawyer– Banker– Investors

• Should have Gotten them into one room and discussed

• Review The Numbers• Review The Business Plan

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Operational Lessons Learned

• Starting Level (Day 1)– Should have Assumed I Know Nothing

• About Business in General• About The Business Specifically

– Should have not Changed Anything For a Year• Learned more from the Team• Hard to do with such old technology

• Should have Spent Nothing– Cash Is King

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Business Lessons Learned

• Rules For Business:–#1 Sales Above All Else–#2 Watch the Cash–#3 Revenue Before Costs–#4 Better Before Cheaper

• Fire the problems • Watch The Cash

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Results

• Compass Provides Information – Data is Now Information

• Watch Economic Activity • AP Cushion Metric• Developing Operational Ratios

• Watching The Cash

Start Up

• Idea– Delivers Impact

• Funding– SBA Loan, Investors and own capital

• Revenue– Reduced Year 1 but trending up

• Customers– Stayed

• Team– Fit into the culture

Re-

Questions?

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Any Questions or Comments Please Contact me Atdjalbert@exhibitassociates.com.

Thanks for taking time out of your day to review this presentation.