Uncategorized Archives - BFS®

Why Do Some Early Education Companies Sell While Others Don’t?

admin — Mon, 31 Mar 2025 13:09:28 +0000

There are many reasons why the purchase and sale of a company can fail. There are also a few ways to ensure that the sale is a success.

While you can do a search and pull up a list of reasons for failed divestitures / acquisitions, the whole list typically comes down to two things. You need…

1. Truthful professionals having and properly utilizing a detailed knowledge of their specialty. The most common complaint we receive from buyers in the industry is the inability to secure complete, detailed and correct information about their potential acquisitions. When you’re choosing a professional brokerage, sales skills have their place. But sales skills aren’t nearly as important as providing meticulous information and being able to explain that information to a qualified buyer. We’ve all been buyers at some point, and we understand that no buyer signs a check until they are comfortable in their decision.

2. Properly managed communication during the due diligence and transition processes. This one sounds simple, but you might be surprised how often one or two misstatements can cause an emotional response and a failed transaction. Whether a buyer has closed 100 deals or zero, no one wants to make a mistake when investing money in a company. That’s why it is so important to know your subject matter and communicate with absolute clarity.

BFS^® is born from an investment banking background and a sales background. At BFS^®, we solely represent our selling clients, but we have thousands of buyers who are already actively engaged with us for the purpose of purchasing our client’s early education companies. By far, the number one compliment we receive from these pre-qualified buyers is they receive a well-organized, comprehensive portfolio right after they sign the NDA. This makes their acquisition process faster and easier…and successful for everyone.

All the best,

Brad Barnett
President, BFS^®
Don’t settle for less than a proven early education company—Talk with BFS^® for the Expertise and Individual Attention you deserve.

"After doing a little research and meeting with you, we were convinced that BFS^® was the company...I must say we were not disappointed. Your knowledge of the business and your professionalism produced a quick sale...."

John and cheryl karay

Former Owners of Kinder College, Inc.
Hopkinsville, KY

BFS^® is the Largest Non-Governmental Provider of FREE Resources to the U.S. Early Education Industry. If you have questions on a topic, watch a quick video by going to our YouTube Channel or access information by going to our Instant Q & A page.

Our new book, How 1000s of Childcare Centers and Schools Are Making Millions, is now available in hardback, Kindle, and Nook so you and your directors can reference the information whenever and wherever you need it. All profits from every book sold go to St. Jude Children’s Research Hospital. This is a great way for you to give to the children who need it most and get this great resource as a bonus for yourself, your staff and your company. Click Here to order your copy today.

(Legal Disclaimer: Always consult the proper professionals before taking action. By and before the use of the information provided herein, reader agrees that BFS^® is not responsible for viewer’s actions related to said information.)

The post Why Do Some Early Education Companies Sell While Others Don’t? appeared first on BFS®.

Six Steps To Choosing A Broker In The Childcare Industry In This Market

admin — Sat, 21 Sep 2024 16:16:21 +0000

We’re in a time when our industry is being described as “broken” or “in crisis”. It’s not the first time we’ve been broken or in crisis. We will solve the shortage of teachers issue and we will bounce out of it. The only real questions are will you catch the bounce and how high will your bounce be.
In every part of life, there are a very few who are truly exceptional in their field. These are the entities (people or companies) that provide you with the best service, the most confidentially and the absolute best results, and they do it consistently. Most people and companies are trying or simply pretending to be exceptional. Unfortunately, when brokers make mistakes in the childcare industry, it can be the difference between a secured retirement for the client or a loss that never gets repaid. For many people, selling their early education company is a once in a lifetime event…an event where you do not want any mistakes.
Recently, I received an email at work in which the brokerage company (a fairly well known company that presents itself as a childcare broker specialist) sent an advertisement to me for a single childcare center that they represent in a small town in the Southeast US. This advertising information included the name of the small town, the exact licensed capacity of the center and negotiable deal points that the seller was apparently willing to concede to any buyer. All of this information was provided without an NDA (Non-Disclosure Agreement) being signed. I don’t think for a second that this company, broker or agent means to purposely do harm to their client. Generally speaking, I think the people in this industry mean to do good. However, with the information provided by this brokerage, a curious but unprofessional or inexperienced buyer could…

a. Identify the center.

b. Walk into the center, show the advertising piece and ask the seller’s staff about buying the center.

c. If it was a competitor, the competitor could send copies of the advertisement to the center to scare the teachers and then swoop in and hire the teachers for their own childcare company.

d. If the buyer was legitimately interested in buying the center, then this information almost guarantees lower offers and more difficult financing for the buyer.
These types of mistakes happen often in our industry. There are lots of brokerages claiming to understand childcare because they have sold a handful of centers. Trust me. At five or ten centers, you haven’t even scratched the surface of professional mergers and acquisitions in the early education industry. I’ve taken many calls from people whose companies were put at risk because a salesman type didn’t understand the meticulous requirements for managing an early education company divestiture. Being a good salesperson does not mean that you can manage an M&A transaction. You must know how to both promote and protect your client. Protecting your selling client by operating under proven Standard Operating Procedures (SOPs) can also make the transaction less stressful, faster and easier for the staff, the parents and the buyers of the centers or schools…not to mention more profitable for the selling client.
We have talked with the owners of many early education companies, some with one or two centers or schools and some with 15 or more. Many became our clients after suffering some of the following industry mistakes:

a. Brokerage underpriced their company.

b. Brokerage didn’t understand the need for exceptional discretion.

c. Brokerage gave buyer’s business information to buyers who weren’t financially or educationally pre-qualified to buy their company.

d. Brokerage didn’t redact the private information (think Social Security Numbers) in their tax returns and other private documents.

e. Brokerage didn’t have a strong enough NDA…or didn’t have the buyer sign an NDA before exposing the identity of their selling client.

f. Brokerages that didn’t know or understand the specific state regulations. Each state has its own set of regulations and while they can be very similar, they’re not all the same. Nobody wants a deal that starts with a contentious relationship with state licensing.

This list is not exhaustive. These are just some of the more common mistakes we see in the business.
Fortunately, the cure to these and other issues is simple. Ask the hard questions of any brokerage or consulting firm you’re considering. We have closed our clients’ transactions ranging from one or two million to $30 or $40 million and the thing that has remained constant is nearly everyone we have worked with is genuinely nice. However, sometimes this trait stops people from asking the more direct questions that we need to ask. ASK all of the hard questions. No matter how big or how small the issue, ask the question. A solid, high-quality brokerage firm will have no fear of giving you direct and honest answers to your questions. Some basic questions that you should ask of any brokerage firm are as follows:

a. Confirm that the brokerage firm specializes in the early education industry. Selling convenience stores, motels and restaurants is great, but it does not qualify a brokerage to sell childcare centers, preschools, Montessori schools or private elementary schools.

b. Confirm years of experience in the early education industry. Nobody starts out selling $50,000,000 worth of centers a year. It takes time to build up to this level.

c. Always ask for references and don’t settle for a name and an email address or a phone number. People get busy with their life after they sell their company. They get into travel, their next company, charitable pursuits…etc. Make sure you can get verifiable comments from the former clients of the brokerage.

d. Check their Better Business Bureau rating. The BBB rates businesses on a scale from A+ to F. It’s easy to check the report card. If they say they don’t have a BBB rating, ask them why?

All the best,

Brad Barnett
President, BFS^®
Don’t settle for less than a proven early education company—Talk with BFS^® for the Expertise and Individual Attention you deserve.

John and cheryl karay

Former Owners of Kinder College, Inc

Hopkinsville, KY

The post Six Steps To Choosing A Broker In The Childcare Industry In This Market appeared first on BFS®.

Childcare–Greater Wealth, Lots of Cash and Time To Enjoy It?

admin — Thu, 04 Apr 2024 17:31:40 +0000

If you haven’t heard, we may be in the greatest childcare sellers’ market of the last 25 years. In all of these years we have never seen a market where the demand for centers so exceeds the number of centers available for sale.

Are you thinking about selling someday? Are you worried that it won't go well? Are you concerned that you won’t get maximum market value?

Talk with our clients. See what they think of our work. See what it’s like to have plenty of cash and a lot less responsibility. We’ll be glad to introduce you to them.

With 30+ years of experience, more than two decades of a Better Business Bureau A+ rating and licensed professionals in 42 states and Washington DC, BFS^® knows how to take care of you and the sale of your early education company. BFS^® is the leading U.S. brokerage and consulting firm in the early education industry. With individual sales ranging from $1,000,000 to more than $30,000,000, we work closely with you while simultaneously micromanaging the process for you.

How is BFS^® different from other brokerage and consulting firms?

The standard model for a brokerage firm is to sign clients, put up advertising and wait to see who responds to the advertising. These buyers may or may not be qualified to buy your company. Founded in 1993, BFS^® has secured more than 5,300 buyers of early education companies and is the only company to track and display this information publicly ( www.bfsinc.net/selling ). These buyers are prequalified financially and educationally in writing before they ever know the identity of your company. In short, when we take our clients to market, we’re talking to multiple qualified buyers on Day 1. We’re not looking for buyers.

How do I know BFS^® can really do these things?

From attorneys to CPAs to bankers, buyers and sellers, ask anyone who has worked with us. Again, please talk with our former clients. Ask them about anything that concerns you. They probably had the same concerns before their sale.

Does BFS^® represent the buyers too?

NO. We only represent you, our selling client. BFS^® never represents buyers or both sides of the same transaction.

Why do so many buyers come to BFS^® to buy centers and schools?

Buyers come to purchase BFS^® client companies for two primary reasons. One, BFS^® represents high-quality centers and schools across all demographics. Two, BFS^® provides what is commonly acknowledged as the best seller portfolio in the business so buyer due diligence is faster and easier. This long-standing practice of providing detailed and truthful information has led some buyers to return and purchase multiple BFS^® client companies. Some buyers have such confidence in BFS^® materials that they have made offers for BFS^® client companies before they’ve actually seen the business in person.

We don’t know when the perfect mic drop moment is for you. Many childcare company owners talk with us for years before they make that decision, but we’re here for you whenever you’re ready.

All the best,

Brad Barnett
President, BFS^®
Don’t settle for less than a proven early education company—Talk with BFS^® for the Expertise and Individual Attention you deserve.

"I had originally worked with another local M&A firm prior to BFS^®. It was not a positive experience. Because of Brad's knowledgeable expertise, he was able to provide many qualified potential buyers, many making offers."

mary innocenzi

The Village Learning Center

Pennington, NJ

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