The Five Cs Every Business Buyer and Seller Should Understand with Mark Sims

Jared Johnson sits down with Mark Sims, Managing Partner at Consult MSG, to discuss what separates businesses that create lasting value from those that create unnecessary risk during an acquisition. Drawing on decades of experience in consulting, corporate leadership, M&A, and post-acquisition transformation, Mark introduces his framework for evaluating businesses through the "Five Cs" of value creation and preservation. Together, they explore why competitive positioning, cash flow management, clean financials, customer concentration, and operational capabilities matter long before a deal reaches closing. They also discuss how buyers should evaluate founder dependency, customer concentration, documentation, and non-compete agreements, along with practical ways sellers can prepare their businesses for a smoother exit. The conversation closes with lessons from real transactions, common deal mistakes, and what successful buyers should focus on during the first 100 days after acquiring a business. Main Takeaways: The Five Cs provide a practical framework for both buyers evaluating businesses and sellers preparing for an exit. Competitive positioning should clearly explain why a business wins customers and where future growth opportunities exist. Understanding the cash flow cycle helps buyers evaluate working capital needs and operational efficiency. Clean, organized financials reduce friction during due diligence and increase buyer confidence. High customer or vendor concentration can significantly increase acquisition risk and should influence valuation. Buyers should evaluate whether customer relationships are tied to the business itself or primarily to the owner. Documented processes, SOPs, contracts, and operational systems make businesses more transferable and valuable. Non-compete agreements are not a substitute for reducing founder dependency and transition risk. Sellers should begin preparing for a sale well before going to market by cleaning up operations, financials, and documentation. Buyers should develop a value creation plan before submitting an LOI and execute against it after closing rather than relying solely on a "wait and see" approach. Connect with Jared: If you have questions for Jared, visit: https://jaredwjohnson.com   / jaredwjohnson   Connect with Mark: https://www.consultmsg.com DISCLAIMER: The views and opinions expressed in this program are those of the guests and host. They do not necessarily reflect the views or positions of my employer. Keywords: business acquisitions, business valuation, entrepreneurship through acquisition, ETA, SBA acquisitions, value creation, value preservation, due diligence, quality of earnings, cash flow management, customer concentration, founder dependency, competitive positioning, standard operating procedures, SOPs, operational documentation, transition planning, acquisition strategy, lower middle market, M&A