Demystifying Company Valuations with Channing Hamlet
Channing Hamlet is the Co-Owner and Managing Director of Objective Capital Partners, a prestigious investment banking and valuation firm with an impressive track record of executing over 500 M&A transactions worth $1 billion and more than 1,000 business valuations.
With over 25 years of experience, Channing has built a solid reputation for his expertise in management advice, transaction execution, and business valuation. This has earned him multiple accolades, including three consecutive years as a Leader of Influence: Investment Bankers by the Los Angeles Business Journal (2020-2022).
SELLING AT A PREMIUM
As an investment banker, Channing stresses the importance of companies understanding what drives value in their sector, building predictability into their business, and having a clear differentiation or unique selling proposition.
Understanding the value drivers in your sector is paramount to preparing a sale. Every industry has different value drivers, and companies need to do their research and figure out what drives value in their industry. They should also be aware of who their potential buyers are and what they are looking for.
Building predictability into a business and having recurring revenue streams and systematizing operations are also vital steps in preparing for sale. This makes the company more attractive to potential buyers, as they can see that the business is predictable and has a solid foundation for growth.
There is also increasing importance of having clean accounting and financial projections that are believable and achievable. Buyers are raising their standards, and companies need to be well-prepared to successfully sell their business at a premium.
CHANGING MARKET CIRCUMSTANCES
In an ever-growing market, the impact of fluctuating market conditions on company valuations cannot be overstated. As industries and sectors experience growth, disruption, and transformation, businesses must continually adapt to maintain their competitiveness and relevance.
These dynamic market forces have a direct bearing on the valuation of companies, necessitating that they stay vigilant and responsive to shifts in consumer preferences, technological advancements, and regulatory changes.
Channing explains that Objective Capital Partners provides valuation services in three areas:
- Financial reporting
- Tax compliance
- Advisory valuation
When embarking on advisory valuations, the key to success lies in actively listening to business owners and thoroughly comprehending their objectives. By establishing a strong rapport and fostering open communication, Channing and his team can effectively tailor their approach to meet the unique goals of each client. To ensure optimal decision-making, the team employs a rigorous methodology that involves modeling multiple scenarios and stress-testing financial projections.
This comprehensive approach allows them to identify potential risks, opportunities, and growth drivers, providing business owners with the necessary insights to make well-informed decisions. Their unwavering commitment to understanding client needs and delivering accurate, actionable advice allows them to remain consistent and trustworthy resources for businesses seeking to maximize their potential.
The market for mergers and acquisitions can be impacted by changing circumstances, such as rising interest rates, but Channing believes that the market will eventually adjust and stabilize. He also notes that there may be opportunities for estate planning in the current market environment.
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For my full discussion with Channing Hamlet, and more on this topic and others discussed:
Listen to the Full DealQuest Podcast Episode Here
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FOR MORE ON CHANNING HAMLET:
Corey Kupfer is an expert strategist, negotiator, and dealmaker. He has more than 35 years of professional deal-making and negotiating experience. Corey is a successful entrepreneur, attorney, consultant, author, and professional speaker. He is deeply passionate about deal-driven growth. He is also the creator and host of the DealQuest Podcast.
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