A couple of weeks ago I was watching the CBS final round telecast of the Waste Management Open from Scottsdale, Arizona. At the beginning of the days round, Kyle Stanley, a second year player from the state of Washington who went to Clemson, was eight strokes back. All Kyle did was shoot a final round 64 and at the end the day was raising the crystal and the check for over a million dollars that went with it.

 As Kyle was playing the final hole, analyst and hall-of-famer, Sir Nick Faldo, made this comment, he said, “Real happiness is great health and a short memory.”  It had only been seven days since Kyle Stanley experienced a “golf meltdown”, witnessed by millions.  He entered the final round play of the Farmer’s Insurance Open with a six stroke lead. On the final hole, still leading by three and just 90 yards from the flagstick, he could take five more shots to get it in the hole and win the tournament. He took six……and lost in a playoff.  He was devastated, overnight he became the most talked about golfer in America for all the wrong reasons.

 Life is amazing and how we react to the hand that is dealt us determines EVERYTHING.  Not too many weeks ago we had our Annual Kick-Off Meeting at Evergreen. I had a number of posters made up that decorated the walls of our conference room. I “borrowed” one of them from the famous American essayist and author, Ralph Waldo Emerson.

“A hero is no braver than an ordinary man, but he is braver five minutes longer”

 There is no time-frame or time-limit on achieving success. Jim Valvano, the late basketball coach of the national championship N.C. State Wolfpack and one of the most dynamic and characteristic coaches ever in the game said this on the ESPY awards just weeks before he died of cancer, “Never Never Ever Quit, he went on to say, “Don’t give up, Don’t even give up.” He went on to say that each of us needs to do three things, we need to laugh, we need to think, we need to cry because of the joy we feel.”

 Life is not a dress rehearsal….make everyday count!

About Evergreen Advisors

Evergreen Advisors is a leading middle market investment bank and corporate advisory firm focused on assisting companies in the areas of corporate finance, growth and exit strategies, business valuations and CFO advisory services.

 

Recently, Rick Kohr, CEO of Evergreen Advisors and Mike Gill, Chairman met with Kevin Plank, Founder and CEO of Under Armour. They covered a wide range of topics from leadership, a 1,000 hits, innovation, to what Kevin looks for in people that join the Under Armour team.

Frustrated by the “soaking wet” T-shirts he wore under his University of Maryland football uniform, the special teams captain created a fabric that wicked away sweat while providing muscle support. Sixteen years later and over $1 billion in revenues, Kevin has built one of the most recognizable brands in America.

What follows is an excerpt of the conversation that Mike, Rick, and Kevin had at Tark’s in Greenspring Station.

{Mike Gill} Some people talk about vision and some people talk about growth. You have said that you don’t think people talk enough about growth. Can you make a couple of comments in that regard?

{Kevin Plank} I am a huge believer that every business we get into has to make money and every business needs to go beyond just a vision. They have to have a practicality of how are we going to make the rubber hit the road and create the returns because: A) we are not that big and B) anyone these days can go out of business as fast as the world moves today. I have a great saying from a guy who told me one time: It’s ok to take one dollar to make ten, but it’s not ok to take ten dollars to make one. Therefore, I live by that rule at Under Armour and frankly, personally too. It is one of my investment philosophies.

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Often times when you get advice on making an investor pitch the focus is all on the presentation. What slides should be included and how you should talk to your audience. Often overlooked is the importance of first impressions and the fact that you have only one opportunity to make the right impression. In the case of a pitch, you have to provide the investors with enough information to interest them and make them want more. So when you only have 7-15 minutes how do maximize your impact?

What is overlooked is that the little details can make or break the deal. The benefit of preparation is that you can prepare for your first impression. While small details, these items do make a significant impact.

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You’ve worked tirelessly to take an idea, commercialize it, acquire customers, hire employees and create a growing company.  You may or may not have raised outside capital to get to where you are, but you would somehow like to get “a little something for the effort.”  How do you convert your ownership into cash?

You could sell your company, which could very well eliminate your future participation in that industry for a period of time due to a covenant not to compete which the buyer will surely make you commit to as a condition of sale.

You could merge with another company, stay involved in managing the combined entity, but you might not get any cash consideration as a result of the deal.

If you have achieved sufficient scale, you could take a shot at bringing the company to the public markets via an IPO, but your underwriters probably won’t let you sell any shares for six months after closing the offering and you will be operating in the fish bowl environment as a reporting company filing quarterly financials with the Securities and Exchange Commission for all to see – including your competitors.

OR

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Under new guidelines released last month, the Financial Accounting Standards Board (FASB) will permit an entity to determine whether it is “more likely than not” (greater than 50% likelihood) that the Fair Value of a reporting unit is less than its carrying amount by considering industry and company specific factors.

Based on its assessment of “qualitative factors,” the entity can determine whether it is necessary to perform the two-step goodwill impairment test under Accounting Standards Codification 350 (“Goodwill and Intangible Assets”).

Corporate financial officers have been vocal in their criticism of the cost and complexity of the two-step goodwill impairment testing process, prompting the FASB to act.  However, introducing highly judgmental factors into the goodwill impairment determination, in our opinion, invites abuse and the distortion of earnings and financial condition which the two-step impairment test was designed to prevent. Consider the factors the FASB suggests for management’s evaluation in the recent Accounting Standards Update 2011-08:

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Evergeen Advisors helped celebrate its tenth anniversary with a food drive for the Howard County Food Bank located around the corner from their Maryland Office.

Shelley Lombardo, Vice President of Marketing noted that “It has truly been a rewarding experience as the families of Evergreen employees have come together to collect food and provide a monetary donation. The 249 pounds of food are equivalent to 208 number of meals supplied to disadvantaged families. Food pantries have been struggling to keep up with the increased demand and we are grateful to help one in our own backyard. “

Evergreen Advisors has a long history of community involvement assisting local charitable organizations. Among the many groups supported are Ed Block Foundation, University of Maryland Medical System, Catholic Charities, National Alliance of Mental Illness (NAMI), The Krista Rita Strouse Foundation, American Heart Association, and the Columbia Foundation.

 

About Evergreen Advisors

Evergreen Advisors is a leading investment banking and corporate advisory firm focused on assisting emerging growth and middle-market companies in the areas of corporate finance, growth and exit strategies,  business valuations and advisory services.  For more information, visit https://evergreenadvisorsllc.com/

Southwest Airlines celebrated their 40th anniversary this year, young by most standards for larger corporations. The origin of Southwest is as remarkable as the great  airline that they have come to be. Their first chairman, Herb Kelleher, led the legal fight to provide service within the state of Texas. It was a long and costly fight but finally on June 18, 1971 Southwest Airlines began offering service to Houston, Dallas, and San Antonio. (If you would like to know more about the Southwest story and their colorful former chairman, Herb Kelleher, a book you would thoroughly enjoy is called “Nuts.”)

Culture is neither negotiable nor optional. Almost 20 years ago, two former Price Waterhouse partners wrote a book called, “The 100 Greatest companies in America”. They reviewed thousands and thousands of pages of data on over 5,000 companies to determine the best of the best. They discovered two unique traits about the companies they eventually chose as “the best 100”. First, except for one company the other 99 had stuck to their knitting during their entire history. The other discovery was that the original “Value statement” and Culture of the organizations had remained intact.

I can remember as a kid in the 60’s and in love with baseball and the Oriole’s, you would often hear people talk about “The Oriole Way” (their culture). What was it that made the hometown team dominant in baseball through the 60’s, 70’s, and 80’s? Sure, it was great pitching and defense and as Hall of Fame Manager Earl Weaver would say, “and a nice three run homer from time to time”. However, it was also the professionalism, team spirit, “hustle” preparation and a determination to be the best that was expected from every player. An organization that has had the highest winning percentage in baseball the last twenty years is the Atlanta Braves, and it is not a coincidence that their leader as GM and now team president for that entire period has been Baltimorean John Schuerholz, whose first job in baseball was in 1966 with…. You guessed it, the Oriole’s.

Is your Culture a competitive differentiator?

Go For It!

http://www.southwest.com/assets/pdfs/about-southwest/garys-greeting.pd

Evergreen Advisors is pleased to announce that Rick Kohr will be a panelist at the, “Maryland’s Cyber Battleground APG to Ft. Meade: The Regional Impact and Global Reach of the New Cyber Technology,” Corridor Inc. conference on September 22, featuring keynote speaker Dutch Ruppersberger, Ranking Member, House Select Committee on Intelligence. Along with working many cyber related businesses in the area, Rick also serves on the Howard County Cyber Commission. The commission advises Howard County Executive Ken Ulman to help maximize opportunities generated by the growth of cyber activity in the Baltimore-Washington region.

Other panelists include high-level Security, Intelligence Business and Military officials including Mark Barnett, Director of Small Business Programs, NSA, Neal Ziring, Technical Director of Information Assurance Directorate, NSA, Bob Hannon, President & CEO, Anne Arundel EDC, Hart Rossman, VP & CTO Cyber Security Services & Solutions, SAIC, Bill Varner, President & COO Mission, Cyber and Technology Solutions, Mantech, Chris Foster, Business Development Executive, Raytheon, and Christian Johansson, Secretary, DBED.

Panelists will outline the state of cybersecurity in Maryland, what lies ahead, and – most importantly – financial opportunities that exist for companies of all sizes.
Special commentary will be provided by Aris Melissaratos, Special Advisor for Enterprise Development to the President of Johns Hopkins University.

For more information visit: http://corridorinc.com/corridorevents/event/3/Maryland%E2%80%99s-Cyber-Battleground
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About Evergreen Advisors
Evergreen Advisors is a leading investment banking and corporate advisory firm focused on assisting emerging growth and middle-market companies in the areas of Mergers and Acqusitions, Business Valuations, Advisory including corporate finance, growth and exit strategies, and CFO advisory services.

I was talking to a friend the other day and she was telling me how tough the marketplace has been for her for too long. I shared with her my philosophy about the “pie” and what you need to do to get your fair slice. You see when times are tough the pie is smaller or to put it another way, your opportunities are fewer than when the tide is rising and there is plenty for everyone. But you still need to get your fair slice of the pie, a daunting task but one that you have to win-no excuses!

Here are some ideas for you to consider and implement NOW.

Say out loud, “THE ECONOMY STINKS”, OK do you feel better, now do something about it…….get the slice you want and leave the crumbs for your competitor.

1. Spend more time each evening and morning reviewing your game plan for the day.

2. Ask for referrals more often. If you did a great job taking care of the customer you’ve earned the right.

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With the advent of accounting (FASB 123R) and income tax (IRC 409A) guidelines regarding the valuation of equity-based compensation, it has become increasingly important for entrepreneurs to become familiar with complex equity securities and the valuation of equity-based compensation such as stock or option grants.

This typically arises in the context of venture capital funding. Providers of early stage institutional funding provide growth capital for emerging companies and therefore, are interested in the return of the their capital (often called liquidation preference)  but also participating in the “upside” or increase in equity value of the business, hence achieving a return commensurate with the risk involved.

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