Ephor Group is a Management Advisory firm that provides Useful Capital and Management Science to create wealth producing enterprises.

Ephor Group eNewsletters Summary for 2013:

eNews Q3 2013:

 

Ephor Group is an advisor on growth capital strategies to investors and founders/owners. Our approach initiates with an intensive investment strategy research process to identify middle market businesses that have the ability to transform their industry segments.

 

Ephor Group's focus today is the same as its genesis; to solve the wealth creation gap for entrepreneurs/investors by helping businesses migrate from subscale businesses to scaled enterprises. We help build highly successful businesses which has enabled our clients to generate best-in-class investment returns.

The firm traces its roots back to Garry E. Meier's operating experience as a public and private company chairman where he developed his service methodologies for maximizing wealth creation. Over the past decade, Ephor has provided resources and growth strategy to help our clients "Solve the Value Equation" and create wealth.

 

Ephor's philosophy is rooted in aligning clients' growth strategy with their wealth strategy coupled with satisfying large market demand opportunities.

 

We partner with founders/owners of businesses who have created valuable franchises but have reached a stage in their business life cycle where they desire outside resources— both operational and financial—to help them evolve their businesses to the next level.

 

Our focus is on growth strategy investments in the lower end of the middle market ($1 MM to $10MM of EBITDA) where we can apply both growth strategy and growth capital to create value to both the P&L and balance sheet.

  • Businesses of this size benefit the most from our direct involvement—it is in this segment of the market where we as a firm have the most to offer—and, therefore, by focusing our efforts here we can produce differentiated returns
  • We believe inefficiencies in this segment of the market afford the most attractive investment opportunities from a risk/return perspective
  • The engine of economic growth in this country is small business. By investing our time, effort and capital here, we can help build the next generation of world class businesses
  • We believe the days of high leverage and ever ascending purchase price multiples are gone.
  • With a differentiated growth strategy, the ability to generate fundamental value creates attractive opportunities

 

We are not a typical firm. We believe that rigorous execution of a sound business strategy is the key to driving fundamental value and generating exceptional investment returns, while best controlling downside risk. Ephor's approach is to think and act like business owners. Change, and the ability to adapt to it, is a business reality in today's economy. Only by thoughtfully exploiting changes underway in a given marketplace can businesses emerge as leaders in the future. For a firm of our size, our team has remarkably diverse backgrounds and skill sets. It is this experience that allows us to work with founders and management to actively assist in the execution of the strategy, rather than to act as passive advisors.

Solving the Value Equation
While we do not run companies on a day-to-day basis, we are actively involved in all aspects of the businesses in which we partner. We work with management to drive the execution of the growth strategy and to implement fundamental business improvements to accelerate growth and improve profitability. Although our level of involvement depends on the specifics of that company's needs, the areas in which our value creation efforts are generally focused include the following capabilities:

 

eNews Q2 2013:
Useful Capital Strategies for Overcoming the Founder's Dilemma

 

1. Overcoming the Founder's Dilemma: Useful Capital Growth Strategy & Options

2. M&A Transactions YTD Commentary

 

 

 

eNews Q1 2013:
Revenue Strategies for Growth in 2013 Beyond Organic: Happy Holidays & Happy New Year!

 

Dear friends and colleagues:

 

As we head into 2013, there are a few salient factors that we must constantly keep reminding ourselves of and be proactive towards:

  • It is well known that the current competitive and market landscapes are in the early stages of bifurcation. Due to risk aversion and uncertainty capital will only be prevalent for branded sector leaders.

  • Government, Education, and Public Services will account for 6 out of every 10 new jobs created. Therefore for small business to attract the human capital required to be successful you will have to provide a “superior work-life experience" to attract top talent.

  • Small businesses will be less of a factor in the growth of GDP and job creation, therefore we will enjoy less B2B small business trade, therefore requiring us to provide goods and services to large organizations, including government as well as find routes to global markets.

  • We must adapt to the changing demographics in the consumer base including Millenials social work habits, baby boomers succession planning, and the increased diversity of consumers including the Latino and Asian communities.

Therefore, it is clear to all of us at Ephor that only the most economically efficient and adaptive business models will be wealth creators. As you prepare for 2013, we suggest you ask yourself these basic questions:

  • What skill gaps do we illustrate and how will we overcome them?
  • Is our revenue model and team going to outperform the competition?
  • Is our team and human capital skilled and talented enough to perform the level of success required?

Have a great rest of year 2012:  focus on getting better, and prepare yourselves and your business models for a successful and wealth creating 2013.

 

Warmest regards,

Garry E. Meier & The Ephor Group Team

 

 

P.S. Read more: 2013 Revenue Strategies for Growth



Revenue Strategies for Growth

 

2012 Forecast from Q4 2011:

The economic forecast is for a slow growth economy for the foreseeable future.

  • Uncertainty in 2010/2011 is creating market bifurcation separating companies into "Laggards versus Leaders." Uncertainty stems from:
    • Slow Growth Economy, Debt troubles, Debt hangovers, Global crisis, Political election, Delayed decision making, Rampant mediocrity, too much noise and clutter in the marketplace.
    • Rising Costs & Complexities = rising costs across healthcare, labor, and regulatory compliance costs of doing business. The US government continues to pile on new regulations, 40,000 pages worth just went into effect on the first of January.  The most significant will be the IRS 1099 reporting requirement.  Obamacare still creates uncertainty and is driving up healthcare costs.
    • Small business squeezed by big government and big business.

  • Capital & Financial Engineering has limited availability for asset light software and service businesses.
    • Credit facilities will be asset based lending only.
    • Venture continues to ride the wave of “Consumerism.”
    • Mezzanine lenders remain eager to put capital to work with transaction structure and pricing relatively flexible.
    • Access to growth capital for the very best business models only.
    • A third of corporate and financial corporate development buyers said they would be buying in 2010 and 2011, versus nearly 95% intended to acquire with 42% intending to acquire 3 or more deals in 2012 (SEQ 2012 Survey results).  
Growth will occur for companies that have lowered their costs of sales compared to competitors, reduced their overall cost structures, and have a portfolio plan for growth and expansion.

In 2012, the goal is to create a defensible niche by adapting to and solving highly segmented customer value propositions.

The challenges of the past few years,have convinced us that winning and succeeding is really more about having the right strategy, team, and resources and then subsequently utilizing them; then about working longer and harder!

 

It is clear to us, that to be a leader a capital efficient revenue strategy for Growth and Expansion married with Management Science and technology, and coupled with a commitment to learning and change is required. 

Over the past decade, we have had the pleasure of working with numerous technology, BPO, Marketing, Healthcare, VAR, staffing, payroll and HR outsourcing providers as well as our friends from the private equity and institutional investor arenas, with great success and learning. We thank-you. 

 



American Small Businesses Vulnerability Economic Recap:
           

In February, in our early year economic outlook, we predicted the following about 2011: clearly there would be little to gradual economic growth in the holistic US economy, a lack of consumer spending, married with uncertainty in the real estate and capital markets. We furGarry_Meier_Bio_image_photother predicted that SMEs (small to medium size businesses) would experience double dip recession pressures as a result of the lack of access to capital and the suppressed levels of business to business spending.

 

The recent news on GDP, which illustrated an expansion of only 1.3 percent and consumer spending up a mere 0.1 percent in the second quarter, coupled with the downgrade of the USA debt, including the lack of a longer term resolution to the deficit is accelerating the problematic economic issues facing small business; therefore it is clear to us at Ephor, the SME sector of the economy has reached double dip symptoms.

 

Economists say that the Great Recession began in December 2007.  And for most small business owners, and for the majority of Americans, the downtown of 2008/2009 never really ended.

 

And what’s worse is that the economic indicators do not show signs of improving in the near-term.  An Ephor Group research survey of small business owners in Q2 2011 found that the majority of businesses are underperforming (only 1 in 5 businesses are “outperforming”). 

 

In fact, we at Ephor believe that the growth rate will not improve significantly until the monthly gain in jobs is consistently 300,000 jobs or more. And, at that rate the gains would have to be consistent for over two years to bring the economy back to what is traditionally considered a reasonable unemployment figure.

 

Read what sectors are poised for growth here: American Growth Sectors

 

We at Ephor therefore believe the symptoms for a slow growth environment are clearly in place, and this downturn will continue for a minimum of the next 10 quarters. 

 

In conclusion, for the foreseeable future the outlook for the economy is simply not favorable and specifically for small business that outlook is even further suppressed.  Bankruptcy rates for the SMB sector will continue to rise as a result of management and the leaders of small businesses simply not adjusting and altering their business models to reflect the exogenous economic factors that are prevalent.  The businesses that will survive and prosper will make those required adjustments either thru great timing or great skill or both. We at Ephor urge all small business to seek outside help and become change agents. It is up to us as a business community to lead the economic recovery just like we have done in every economic downturn.

 

Let us know how we can assist you in your efforts, and best of luck in the near-term.


 

“The goal is wealth creation through the use of efficient growth methodologies and experienced execution,” said Garry E. Meier, Chairman of Ephor Group.   

“Creating wealth is all about creating the qualities of right: the right strategy, with the right people, with the right model, and the right business process. Our approach provides the required operational execution support and risk mitigation strategies that every enterprise warrants.”

 


Contact an Ephor today at:
713.977.3600
ephor [at] ephorgroup.com


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