GEORGE SANDMANN

Hi there, welcome. 

I'm a lucky man. That's why I wrote The Growth-Driving Advisor: Leading Businesses from Stuck to Best-in-Class. It's coming out in September 2023 from Forbes Books. Stay in the loop.

We'll get to the 'lucky' part in a sec. You know, private business is the engine of our economy. The middle market alone has a higher GDP than the national GDPs of Germany and Japan combined. The middle market provides 44% of our jobs and 63% of new jobs -so says the Census Bureau. They contribute 1/3 of our national GDP. And we are entrusting the women and men who are leading these businesses with our economic future. Fun fact: the vast majority of business owners are boomers. This means they are as a class sunsetting, which is an opportunity and a threat...

Because the data is in: the average middle market business is mortal. It cannot survive and thrive without it's founder. Mortal because they have not (yet) adopted the principles of best-in-class competitors - not everyone gets a trophy, right? Did you know that the one question on every due diligence checklist is "Can the business survive without the senior leader?" If the answer is "No" then when the current leaders sunset the business, its stakeholders and the communities they support face an very uncertain future. If you're fuzzy on the whole good-bad thing, add pre-middle market to the list and this is bad to the tune of about half of our national GDP.

What does this all imply? Three things: (1) We need to help these businesses grow and thrive, creating more and better well-paying jobs. (2) It implies that we need to make sure that middle market businesses become immortal -that these businesses will grow, prosper, and go on to greater glory after the founder leaves... and (3) If they're not best-in-class now, they will need fresh ideas and guidance to get there. They don't know what they don't know.

Business owners need help. They need to learn new tricks. They need outside guidance - they need professional advisors like you. Because the data is also clear on this point: businesses that get outside help are most likely to evolve into best-in-class competitors, generating more cash and more wealth for their stakeholders and communities.

Remember when I said "I am a lucky man"? In this context it means I have the great good fortune of a decade-plus working with hundreds and hundreds of senior pros on thousands and thousands of client cases. Over time, trends and best practices became clear and their effectiveness proven. That's why this book exists. Leveraging a 30 year career as an entrepreneur capped by more than a decade helping advisors win, the book shares expertise that can be applied to win and execute deeply impactful engagements immediately. 

Through this work you will learn about strategic capacity (below). You will learn about why and how to measure and increase strategic capacity, creating a winning machine. The process is well understood, it's what private equity and their professional operators do every day. 

What does winning look like? You already know: the best businesses create predictable profits and cash flow, predictable sustainable growth and predictable transferable equity value. These are the Three Dimensions of Business Growth, and you're going to learn how to do it.

When you do, you know what? You'll never have to look for a client again. You will have a thriving advisory business. And you will have done real 'good' for society. That's a hell of a legacy, right? Doing what we've learned is like helping your clients lead a private equity play on their own business, and it's magic. 

Thank you, I hope the book delivers for you. -George

PS: Be one of the cool kids and stay in the know: join the conversation here

You can check out what your colleagues have to say about all this a little further down this page.

Strategic Capacity: The Key to Business Success

As a measure of a business’ ability to reach its goals, ‘Strategic Capacity’ refers to a demonstrated ability to deliver predictable profits, growth and equity value, together being the 3 Dimensions of Business Growth™. The term ‘predictable’ is used to connote low risk/high confidence that the described result will occur. This is important because understanding predictability is at the root of the due diligence process attendant to M&A and similar monetization mechanisms. Businesses with high Strategic Capacity typically outperform their peers and are best-in-class competitors.

Strategic capacity has two elements: growth capacity and value capacity. Growth capacity refers to the ability to deliver predictable profits & cash flow, coupled with predictable sustainable growth. Value capacity refers to the ability to deliver predictable equity value, and focuses on factors including market position, veracity of financial records, legal compliance and more. High growth capacity and high value capacity together create high strategic capacity. If we accept that the ultimate measure of business success is high shareholder (equity) value, then understanding strategic capacity equates to understanding a business’ ability to maximize value. 

The methodology and process for maximizing strategic capacity is described in George Sandmann’s The Growth-Driving Advisor: Proven Strategies for Leading Clients from Stuck to Best-in-Class, Forbes Books 2023. In this work the author defines the Three Dimensions of Business Growth and describes a proven system through which private businesses in the pre-middle and middle market can increase their strategic capacity and reach defined shareholder goals.  The work is based on client cases from over one thousand business advisors including management consultants, business coaches, accountants, investment bankers, wealth advisors and fractional CFOs.

To visualize the symbiotic impact of strategic capacity on equity value, imagine a graph. High strategic capacity is in the upper-right corner with a value of (for example) $10MM, and low strategic capacity is in the lower-left with a value of $0. The $10MM represents maximized equity value calculated from a financial perspective. Plotting growth capacity in the horizontal x axis, and value capacity in the vertical y axis, imagine a point on the chart determined by scoring each capacity. One can see that a business with high growth capacity but low value capacity might deliver lower equity value than one with high performance in both. It follows that where a business cannot demonstrate highly predictable profits and growth, in addition to lacking the ability to demonstrate market position, veracity of financial records etc. low or no monetizable value exists. Note that the business’ latent value remains $10MM; understanding strategic capacity delivers insight into the ability of the shareholders to monetize this latent value. 

The connection between revenues and transferable equity value is not automatic. Achieving high strategic capacity as accomplished by re-designing the subject business so that it harnesses people, cash and processes in a manner that creates a best-in-class business engine, delivering profits, growth and value at or above those delivered by competitors. This operational performance is codified and explained in interconnected, documented and scalable processes the performance of which is tracked in timely and accurate reports. It is logical that such a business is best-in-class, positioned to attract customers and capital and thereby demonstrably likely to sustain growth going into the future. 

©2023 George Sandmann