Lisa Riley is the founder and president of Delta Business Advisors. Lisa has worked in the industry since 2011 and is the incoming chair of the International Business Brokers Association (IBBA).
She is also the past chair of the Arizona Business Brokers Association (AZBBA) and spearheads the quarterly IBBA/M&A Source Market Pulse Survey. Lisa holds several certifications, including IBBA’s Certified Business Intermediary and Coles College of Business‘ Certified Mergers & Acquisitions Professional. She also has been awarded the prestigious Tom West Award and several awards for outstanding producer from IBBA and AZBBA. Lisa’s educational achievements include a BA from Benedictine College and M.A. and Ph.D. in Sociology (focusing on research methods and statistics) from the University of Notre Dame.
Lisa, tell us about your pre-M&A career and how it led you to do this work?
My experiences as a former university professor, owner of an evaluation company, and general contractor for our home led me to business brokerage and M&A transactions. In a nutshell, my husband received an offer to move to Arizona for his career and, as I did not want to have a commuter marriage, I made the decision to leave my tenured position and move with him. This also meant the beginning of the demise of my evaluation company as I had not planned for transitioning ownership, like many business owners. I ended up referring clients to another company and closing my doors. I then became the GC to build our home and through that process, I learned the business and thought I would continue to help friends, etc. I needed a GC or real estate license to move forward expeditiously. As the GC licensing entailed a lot of hours, years of training, etc., I quickly chose the path of real estate due to a few weeks of classes, a test, and significantly lower expense. In my training, I learned that one had to have a RE license to sell businesses. I then began to research, interview brokers, intermediaries, and business owners. The more I learned, the more excited I became and chose this path. I believed that with the aging of the baby boomer business, I could add-value. I affiliated with a franchise and found an M&A mentor, Jim Afinowich. The rest is history.
What personal characteristics and strengths have supported your success in this industry?
Humor, flexibility, and brutal honesty. One must be able to see the humorous side or be able to stay calm in the midst of emotional outbursts and successes as well as disappointments. There is a creative solution to most issues…with trust and an ability to understand what the issue is about. By listening more than talking, telling the unvarnished truth at all times, and always treating others with the utmost respect, sellers and ‘real’ buyers (including sophisticated private equity, corporate or assertive individuals) will transition as smoothly as possible. In a nutshell, SWSWSWN – Some Will, Some Won’t, So What, Next.
What is your greatest M&A accomplishment?
It was in the sale of a heavy equipment company in a leased property. At the closing table, the Seller’s attorney (my client) came in with additional criteria for the buyer to pay some of the repair costs to the property that the seller had already agreed to pay. With some creative negotiation as the Buyer was walking away, we managed to complete the deal.
Regarding most of your engagements, do you work as a team or do you handle things on your own?
Both. As the owner of a boutique firm and as part of Cornerstone International Alliance, I work with high-quality individuals.
Do you just do M&A, or do you provide other services – valuations, consulting, etc.?
We work on larger Main St deals and lower M&A. We refer out for other services – valuation, financial consulting, etc., – and they refer to back us as well.
What is the biggest mistake you have made when working on a deal?
While working on a joint endeavor, we took on a client whose financials appeared great. They had a long-term CPA and we felt good about the deal. Unbeknownst to either of us, this corporation had included such things as stabling horses in COGs of the manufacturing company which created distrust on our part. We both ended up disengaging after a significant amount of time had been invested.
What are the three most important qualities that you think a good M&A advisor needs to have?
- Creative thinking/negotiating ability
- Listening and ability to identify underlying issues/items/values
What is the most interesting deal that you are working on today?
I’m currently working with a manufacturing company with the management team who all wish to depart (they are in their 70s & 80s). This is a work in progress as we have to find a buyer who does not want the management team to stay after closing.
How long have you been an M&A Source member and what do you get out of your membership?
Around four to five years. Although there are many benefits, the two most beneficial to me are the conferences and First Research. Members have freely shared their knowledge and expertise through workshops, classes, and informal conversations during happy hours or after hours at the conferences. Additionally, I regularly use the First Research industry reports prior to meeting with business owners.
As a seasoned M&A advisor, what changes and trends do you see on the horizon that will impact on M&A?
As a researcher, I’m always looking at the numbers, research, statistics, past and projections. With COVID-19, aging baby boomers, a recession/declining economy, and racial unrest, changes are bound to happen. There are three trends I am watching that will impact on our industry:
- Past recessions have shown that good advisors remain in the business and good businesses still are saleable.
- Aging baby boomer business owners may not have it in them to rebuild one more time, thus, the closing of some businesses, an increase in distressed business sales, and potentially more buyer bargains or low values due to seller issues such as financials/owner as business/customer concentration/etc.
- Consolidation of larger companies buying up or taking over their competitors due to the ability to attract employees and provide a better product or service for a better value.
What advice would you give to new people entering the profession?
Find a mentor or join an established office. There is a multitude of minutia that can screw up a deal…and you really don’t know where the landmines are. I’ve avoided A LOT of landmines just by asking questions.
Please tell us something about yourself that has nothing to do with your M&A career.
Several years ago, I decided to go sky diving with a friend. I was really excited until that fateful moment when I had to let go of the door frame of the airplane. Since it was tandem, I had no choice and off we went. The rushing noise, the fast descent, to the hard earth came to an abrupt and peaceful halt when the chute was pulled. Floating through the air was serene and peaceful. Unfortunately, it did not last long enough and soon we were on the ground…and ready to go again. It was a great lesson in learning how to face your fears. However, I have put those days behind me now!