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7 Financial Blind Spots of Business Founders—and How to Avoid Stalled Growth
The enterprising visionaries who found their own companies are some of the most ambitious, and creative, driven people on the planet. But that doesn’t mean founders are good at everything. In fact, competency on finance-related matters is often one of founders’ biggest blind spots. Financial illiteracy is one of the top five reasons why startups fail to find success, according to 2023 research published in the Journal of the Knowledge Economy.
Does that mean founders need to become as knowledgeable as a CFO? Absolutely not. The most important thing that founders can do is become aware of their financial blind spots. Once founders are self-aware, they can surround themselves with trusted advisers who will bring specialized skills, experiences, and perspectives to the table. Then, they can empower their financial experts to identify and eliminate financial blind spots.
Let’s explore seven financial blind spots that are common among founders, plus proactive steps that companies should take to ensure that these blind spots don’t stall growth.
1. Not Doing Robust Cash-Flow Forecasting
Cash flow is one of the most important things for a business to get right. Without positive cash flow (or at least a clear plan for how to get there), the business risks not being able to pay its bills. Unfortunately, many businesses don’t know how to spot cash flow problems—nor do they understand how far out they should be doing cash flow forecasting. If a business is profitable, founders tend to breathe easy and not invest in cash flow forecasting.
My general rule of thumb is that cash flow forecasts should be updated every single week with a detailed view of the next three months. Moreover, businesses should be looking at least 12 months into the future at a higher level to provide clarity on potential cash needs. It’s also important not to let perfection be the enemy of good. In other words, all financial forecasting is wrong to some degree. Rather than let analysis paralysis thwart an organization’s ability to do cash flow forecasting, the business should just start doing it regularly. The business will get better over time.
2. Not Prioritizing Strong Revenue Collection Workflows
When founders initially set up their accounts receivable and accounts payable workflows, they tend to implement overly simplistic processes that assume a best-case scenario in which the company consistently invoices customers accurately and in real time and customers consistently pay in a timely manner. Such naivete can get companies into real trouble: In the absence of strong, articulated workflows, it’s common for companies to let timely invoicing slip through the cracks. A lot of the time, most customers don’t pay right away—in fact, they tend to delay paying until the deadline or need to be repeatedly reminded even after the deadline has passed.
I remember working with a client that wasn’t issuing invoices on time, and customers weren’t paying by the deadline. I worked with this client to design a workflow in which it called each client to outline payment expectations; this new workflow resulted in the average payment being made in 22 days instead of 45 days.
3. Not Focusing on High-Value Financial KPIs
Over time, businesses tend to expand the number of metrics they use to track financial performance. It’s not uncommon for someone to suggest an additional metric to track and then add it to the list. I’ve worked with companies that were tracking 30 different metrics but could not articulate how they were using any of these metrics to drive their decision-making.
The reality is that there are typically only two or three metrics that really drive financial performance. While most of these high-value metrics are unique to each business, a key universally applicable metric is contribution margin ratio, or margin percent, which reflects how much revenue is being brought in relative to how much money is being spent to produce that revenue.
4. Focusing Solely on Top-Line Growth
When businesses focus primarily on top-line growth, they tend to look only at whether the organization as a whole is growing at the expected pace. They don’t drill down into how specific teams and functions of the business are (or are not) contributing to this growth. Needless to say, different facets of a business don’t all contribute equally. Thus, when founders don’t parse their growth data at this granular level, they can easily miss specific facets of the business that are losing money or that are dragging down the company’s margin percentage.
One company I worked with decided to double down on sales reps in order to accelerate revenue growth. However, without the appropriate efficiency metrics in place, the company ended up just increasing operating expenses without the added revenue. Understanding how to grow profitability is key in today’s environment.
5. Inadvertently Worrying Investors and Shareholders
Most founders’ intuition about how to interact with their investors and shareholders is completely wrong. Founders tend to be reluctant to share specific information about financial performance, whether good or bad. When the news is bad, founders are fearful that investors are going to make or suggest changes that the founder doesn’t want.
When the news is good, founders are fearful that investors’ expectations will be raised too much and the performance won’t be sustainable. The key is for founders to put themselves in the shoes of investors: Investors need enough financial data to be reassured that their investment is safe. Thus, it’s important for founders to figure out what types of information will help reassure investors.
In one recent board meeting, investors wanted to understand the processes the company was using to close deals and what steps the company was taking to strengthen customer contracts. . These insights helped the investors recognize that despite imperfect financial performance, the company had strong plans in place.
6. Not Staying on Top of Regulatory and Compliance Risks
Founders face a dizzying array of constantly shifting regulatory and compliance landscapes. Whether it’s with taxes, insurance or financial audits, or any number of industry-specific obligations, companies cannot afford to let any of these risks slip through the cracks. Fortunately, companies can retain the services of as many experts as they need to stay on top of every regulatory and compliance risk. I recommend that every founder have a strong working relationship with a good attorney and a good CPA firm; they tend to consistently prove to be more valuable than what the company is paying them.
7. Failing to Recognize Volatility on the Horizon
Founders tend to struggle to recognize volatility on the horizon. The reason is simple: They aren’t looking in the right places, and they aren’t looking far enough out.
Take the example of a transportation services company that I worked with: The company was expecting and planning for a seasonal downturn in business during the cold winter months. But then the company put on its blinders and missed signs that business was not picking up strongly again in the spring due to an economic downturn. As a result, the company struggled to properly plan for and navigate this downturn. By putting more focus on recognizing economic volatility, the company was able to avoid being blindsided going forward.
Partner with Experts
Founders are susceptible to a range of financial blind spots, from inadequate financial forecasting to subpar revenue collection processes to focusing on low-value KPIs. While it’s important to be aware of these blind spots, founders don’t need to become finance experts; they can partner with experts. Moreover, most startups and smaller companies cannot afford to hire a top-tier finance team; that’s where fractional leadership can become a strategic asset.
Through a fractional partnership arrangement, budget-conscious companies can retain multiple finance professionals with different types of specialized expertise. It’s akin to companies that don’t think twice about retaining multiple “fractional” attorneys to help them navigate different specific legal issues. And the results consistently speak for themselves.

Fractional vs. Full-Time CFOs: Which Is Right for Your Business?
Did you know that the average annual salary of a chief financial officer (CFO) in the United States is around $450,000? That’s a significant expense for a business that is just starting or in the early stages of growth. Many businesses today need the strategic expertise and leadership of a high-level financial executive but lack the budget to afford one. As a result, they tend to hire lower-level employees who can manage reports and bookkeeping but lack the strategic vision needed to drive the business forward.
Luckily, there are options for business owners to access the strategic leadership of a CFO without the cost of a full-time hire. The choice between engaging a fractional CFO or hiring a full-time CFO depends on your specific needs and resources. Each approach offers distinct advantages and challenges, making it essential to evaluate both options carefully. This blog provides an overview of both approaches, compares pros and cons, and offers key insights to help you decide what is best for your organization.
Overview of CFO Roles
A fractional CFO works part-time or on a contractual basis, serving multiple clients and focusing on high-impact projects. These professionals are often brought in to develop financial strategy and advise on specific efforts—such as fundraising or financial restructuring—or to fill interim leadership gaps.
In contrast, a full-time CFO is a dedicated member of the organization, responsible for comprehensive financial oversight, strategic planning, risk management, and team leadership. They work closely with the executive team and become deeply embedded in the company’s culture and long-term goals.
Pros and Cons
Both fractional and full-time CFOs come with distinct benefits and drawbacks.
Fractional CFOs provide cost-effective solutions for businesses by working on an as-needed basis. This flexibility allows companies to access experienced professionals for specific business needs without committing to a full-time salary. Their diverse expertise, gained from working across industries, adds significant value to project-based initiatives. However, their part-time nature may result in limited availability, as they balance responsibilities with multiple clients.
On the other hand, full-time CFOs offer the advantage of being fully immersed in the organization. They bring a deep understanding of the company’s operations and culture, ensuring long-term financial stability. Their presence also strengthens internal teams through leadership and mentorship. However, these benefits come with a higher financial cost, including salaries, benefits, and bonuses. Full-time CFOs may also be less flexible, making them a less practical choice for smaller or rapidly evolving companies.
Key Expectations
The roles and responsibilities of fractional and full-time CFOs differ significantly.
Fractional CFOs typically focus on strategic initiatives like financial planning, cash-flow management, and supporting fundraising efforts and investor relations. They may also play a crucial role in mergers, acquisitions, and transition periods.
Full-time CFOs, however, take on a broader scope, overseeing all financial operations, developing long-term strategies, and ensuring compliance with regulations. Their involvement is integral to the company’s executive decision-making and overall success.
Cost Analysis
Here’s a side-by-side comparison of the costs and commitments associated with hiring a fractional versus a full-time CFO:

This breakdown highlights the financial and operational differences, helping businesses align their choice with their budget and requirements.
Recommendation
Choosing between a fractional and full-time CFO requires an assessment of your company’s current needs and growth trajectory.
- Consider a Fractional CFO if your business is in its early stages, has limited financial resources, or requires flexible, project-based expertise. This approach is particularly effective for scaling businesses or those undergoing rapid changes.
- Opt for a Full-Time CFO if your company is more mature, with complex financial operations requiring consistent oversight and strategic leadership. A dedicated CFO is invaluable for long-term stability and driving the company’s vision.
Both fractional and full-time CFOs offer unique advantages depending on your company’s stage and priorities. Fractional CFOs provide cost-effective, flexible solutions ideal for emerging or scaling businesses, while full-time CFOs bring dedicated leadership and in-depth knowledge essential for established organizations. By carefully evaluating your financial needs and long-term goals, you can choose the CFO model that ensures robust financial leadership and sustainable success.
Considering a fractional CFO? Schedule a free consultation to discuss your needs and to see if a fractional CFO would be a good fit to support your business’s growth.

Peak Business Valuation Joins the Ampleo Family
Did you know that nearly half of all businesses fail within the first five years, with only about 35 percent of them surviving through their tenth year in business? To endure and succeed well into the future, small to medium-sized businesses (SMBs) need access to clear data insights, financial expertise, and leaders who have been there, done that.
As we continue in our mission to help businesses access the leadership they need to thrive, I’m excited to announce our third acquisition this year: Peak Business Valuation. We couldn’t be more excited about what this latest acquisition means for Ampleo clients. Let’s explore how adding Peak’s valuation expertise to our suite of services will fill the gap experienced by many national SMBs.
Valuation: A Critical Component of Business Strategy
Peak Business Valuation has built a reputation as one of the highest-rated valuation firms in the country. They are not just any valuation company—they go above and beyond to deliver an excellent client experience. They have forged partnerships with over 90 SBA lenders, invested in a people-first approach that not only provides top-tier valuations but also adds valuable business insights.
Valuation isn’t just a snapshot of worth—it’s a roadmap to future success. It offers key insights into activities across a business’s lifecycle, including the following:
- Buying a business
- Selling a business
- Machinery and equipment appraisal
- SBA-compliant business valuation
- Succession planning
- Assessing risk
- Litigation
- Driving sustainable growth
By bringing Peak Business Valuation into the Ampleo family, our clients will now have a team that can work side by side with their fractional CFOs to lead them through not only big moments like purchasing or selling their business but also strategic planning for growth at their company.
Planning for an Uncertain Future
When business owners need a valuation, whether they’re buying or selling the business or simply need a health check to see how their business is performing, our fractional CFOs will work directly with the Peak Business Valuation team to provide greater guidance to business owners—in whatever stage of growth they are in. This means better planning for the future and confidence in every financial decision. With a valuation, clients can define exactly how to best grow their business by negotiating the best purchase price, identifying key risks, and understanding their market positioning.
However long an SMB needs support, the insights and mentorship offered by fractional CFOs and quality valuations will last long after engagement ends. Our executives and Peak alike both bring diverse experiences from across industries, offering objective perspectives to tackle complex challenges. This collaborative approach sparks innovation and helps SMBs implement best practices for long-term success.
How Valuations Fuel Business Growth
Business valuations are a powerful tool for growth, offering SMBs a clear roadmap to success. With the combined expertise of Peak’s valuation precision and Ampleo’s strategic vision, clients can now transform financial data into actionable growth strategies.
A comprehensive business valuation provides more than just a number; it offers insights into a company’s strengths and areas for improvement. Like an annual medical checkup, a valuation offers business owners essential insights into their health, including financial stability, growth, current value, and risk. Without this information, businesses are flying blind, unsure of how they’re performing or what to focus on to grow.
Between access to high-impact business valuations and vision from fractional CFOs, CMOs, and HR leaders, SMBs will have a compass to guide them through the challenges of growth and organizational change.
This acquisition marks the beginning of an exciting new chapter for Ampleo, Peak Business Valuation, and most importantly, the clients we serve. If you are a business ready to take strategic growth and leadership to the next level, lets talk.

A New Chapter for Ampleo Marketing: Strategy Meet Execution
Today marks an exciting milestone in Ampleo’s journey. I’m thrilled to officially announce the acquisition of Stage Marketing, a full-service digital transformation agency. As the managing partner of Ampleo, I’m excited to share this news and what it means for our clients.
The addition of Stage Marketing aligns with our vision to bridge the experience gap that often exists in small and medium businesses by providing flexible, fractional marketing teams. The measurable result is stronger brand presence, lower acquisition costs, and accelerated growth. The intangible result is confidence for founders and operators as they scale.
Let’s dive into the details of what this new stage will look like for Ampleo and our clients.
The Power of Synergy
We’ve always believed in the criticality of experienced leadership in driving efficient business growth. Our model of providing fractional CFO, CMO, and HR services has empowered countless businesses to access this strategic leadership without the commitment of full-time hires. Now, with the addition of Stage Marketing to our suite of services, we’re taking that commitment to growth to a new level of execution.
When we first connected with Stage Marketing, it felt like finding the missing piece of the puzzle. Stage Marketing seamlessly complements Ampleo’s strategic approach by adding unparalleled execution capabilities in content creation, digital strategy, public relations, web development, SEO, and design. Its proven track record of delivering thousands of successful projects across various industries aligns perfectly with our mission.
We’ve redefined what it means to deliver marketing solutions by combining strategy and execution into what we’re calling “marketing as a managed service.” Fractional CMOs are the drivers steering the marketing vehicle, and Stage Marketing is the engine propelling it forward.
Enhancing Our Service Offerings
This acquisition represents more than a business transaction: It’s a strategic move that will enhance our ability to serve our clients better. By integrating Stage Marketing’s capabilities with our existing marketing services, we’re creating a powerhouse of solutions that blend strategy with execution.
Our clients will now have access to a skilled team to deliver the following:
- Content development
- Creative, video, and design
- Website development and optimization
- Paid media
- Lifecycle marketing
Imagine having an integrated marketing team that understands your business at a tactical level led by providing the flexibility of fractional leadership.
A Shared Vision for Growth
When I first connected with the Stage Marketing team, I knew we were onto something special. Their passion? Infectious. Their skills? Razor-sharp. What excites me most about this partnership is the shared vision we have for our clients.
Lathum Nelson, director of practice at Stage Marketing, echoed this sentiment when he said, “Partnering with Ampleo is a game-changer for Stage Marketing and the clients we serve. By combining Ampleo’s big-picture strategy with our get-it-done execution, we will be able to deliver impactful campaigns that help clients scale and drive real revenue growth.”
By combining Ampleo’s strategic leadership with Stage Marketing’s executional excellence, we’ve created an innovative model that provides not just high-level marketing strategy but also a fully integrated marketing team capable of crafting brands, developing campaigns, and delivering results—all with flexibility, scalability, and efficiency.
I’ve been in the business long enough to know that numbers matter, but people matter more. This acquisition is about more than spreadsheets and synergies (though we’ve got those, too). It’s about bringing together two teams with a shared fundamental belief in empowering businesses and creating lasting impact.
Looking Ahead
As we move forward, I’m confident that this acquisition will allow us to offer even more value to our clients. With the introduction of marketing as a managed service, we’re empowering organizations to access both strategic executive leadership and a highly skilled marketing team—delivering a seamless blend of vision, strategy, and execution.
Together, Ampleo and Stage Marketing allow growth companies to rethink how businesses approach growth. Stage Marketing isn’t just joining Ampleo: We’re creating something bigger than ourselves. As a managing partner, I’m not only excited but also deeply committed to this transformation. This isn’t about checking a box: This is a bold step toward reshaping how companies approach growth, marketing, and strategic development.
To learn more about Ampleo’s acquisition of Stage Marketing, read the full press release.

Ampleo Strengthens Its Offerings with New Acquisition: Peisner Johnson
At Ampleo, our mission is simple yet powerful: to empower businesses with the expertise they need to amplify their growth. Since our beginnings in 1996, we’ve specialized in providing fractional executive services to small and mid-sized businesses. We believe that every organization deserves access to top-tier leadership. Whether it’s navigating financial challenges, scaling operations, or developing go-to-market strategies, we serve as a single, trusted partner for our clients without the burden of full-time employees’ overhead costs.
As we enter 2025, we’re developing new ways to help our clients achieve all of their goals. To that end, we’re excited to share some big news: Ampleo has officially acquired Peisner Johnson, a premier sales tax services firm.
Peisner Johnson: Sales Tax Specialists
As a fractional services company, empowering our CFOs with sales tax resources makes perfect sense. Our clients rely on us to be their partners and advisors, helping them navigate complex business challenges while staying lean and efficient. Taxes, especially sales tax compliance, are one of the most critical areas where companies can’t afford to make mistakes, yet they’re also one of the most challenging to manage.
Founded in 1992, Peisner Johnson has built a trusted reputation as sales tax specialists—helping businesses navigate the tricky waters of state tax compliance. Its experienced team is laser-focused on making sales tax simple with a “client-first” approach. Peisner is a proactive and honest leader in its field, which makes it the perfect partner for our CFOs.
A Shared Mission and Vision
One of the compelling reasons for this acquisition is the cultural fit between Peisner Johnson and Ampleo. We’re focused on the individuals behind the business, helping them achieve business growth smarter and faster, while Peisner aims to help its clients navigate the often confusing landscape of sales tax as seamlessly as possible. For both companies, people are the priority!
Over the years, our fractional CFOs have frequently partnered with Peisner Johnson to help our clients tackle unique tax challenges. Peisner’s dedication to client success—with over 1,000 happy customers—combined with its deep expertise in taxes (30 years of experience), made it an obvious choice for Ampleo.
Barebones Living: A Peisner Johnson Success Story
How do our CFOs successfully partner with Peisner Johnson? Meet Barebones Living, a company selling high-quality, natural products for outdoor sustainable living. As a small, fast-growing company, Barebones was facing the challenge of becoming compliant. With the guidance of Duke Heninger, an Ampleo Partner and fractional CFO, Barebones turned to Peisner Johnson to address its sales tax challenges. Peisner helped Barebones understand its tax responsibilities and liability all while allowing the company to drive the pace of and make final decisions about implementation.
What was the result of this Ampleo/Peisner Johnson partnership? A smooth resolution for Barebones, who could then focus on growing its business without worrying about compliance headaches.
“Peisner is a partner for sure,” said Duke. “They do sales tax faster and better, allowing business leaders to focus on things that are more important for the company.”
This case is just one example of how future Ampleo clients can now benefit from Peisner’s expertise.
Strengthening Our Offerings
As we continue to grow and enhance our services, bringing Peisner Johnson into the Ampleo family is the perfect next step. By integrating tax services into our other comprehensive services, we’re not just adding a new offering—we’re strengthening the value we provide as a one-stop solution for businesses so they can focus on growth.
Looking Ahead
This acquisition is just one step in Ampleo’s expanded vision. Over the years, we’ve continued to grow with enhanced services—always with the goal of meeting the evolving needs of our clients. With Peisner Johnson now part of our team, we’re doubling down on our commitment to being the go-to partner for organizations in need of a strategic partner with the technical expertise needed to get things done.
For us, it’s always been about more than just the numbers. It’s about the people behind the businesses. We’re here to make their lives easier, their decisions smarter, and their futures brighter. Welcome to the next chapter of Ampleo! This is just the beginning of an empowering new approach for the organization.
To learn more about the merger of Peisner Johnson and Ampleo, view the press release.

Workforce Planning Checklist
Ready to build a workforce that drives your business forward? Download our Workforce Planning Checklist to help you transform how you approach talent management.
What’s Inside
- A six-step framework used by successful organizations
- Essential questions to evaluate your current planning process
- Pro tips from HR experts for each step
- A checklist to guide your planning

From Reactive to Proactive: Embracing Always-On Workforce Planning
Ready to unlock the full potential of workforce planning?
Watch our webinar, “From Reactive to Proactive: Embracing Always-On Workforce Planning,” hosted by Ampleo and ChartHop.
This webinar will introduce you to the benefits of agile, data-driven workforce planning. Katie LaFranchi, partner at Ampleo’s HR division, and Ian White, CEO of ChartHop, explore how always-on planning can help you stay ahead by optimizing staffing, preparing for future talent needs, and driving team productivity.
What You Will Learn
- Forecasting talent demands in real time
- Analyzing workforce supply and demand to reduce skills gaps
- Using proactive planning for recruitment, training, and succession
Fill out the form to watch the webinar and download the handout.

The Power of Executive Collaboration in Marketing
As a CMO, my goal is always focused on how to drive ROI for the organization. Every day, I dive deep into what marketing strategies will drive revenue for the business. I consider the initiatives that will deliver a strong ROI, and I research the channels that will reach our desired audience. While my role as a CMO is vital to the growth of the organization, so is the role of the CFO and other C-suite leaders. Knowing how to collaborate with other C-suite executives is key to organizational alignment and marketing success.
Let’s talk about the C-suite and CMO dynamic, including how to build trust, how to speak to the team to drive growth, what are important metrics that matter to everyone, knowing when to experiment in your marketing strategies, and more.
How to Build Trust as the CMO
In a study focused on marketing and the CMO, CEOs trust their CFO the most, followed by the COO, CSO (Chief Strategy Officer), and finally, the CMO. Interestingly, CMOs have the shortest tenure of all the C-Suite members. Is this because of lack of trust between the executives or lack of insight into the real return on investment of marketing?
Historically, marketing has traditionally owned creative and storytelling, finding the best story for the customer. Today, marketers are more involved with driving business and growth and certain metrics can help quantify the success of those efforts.
Marketing analytics should shine a light on how marketing efforts are generating revenue for the company and leading to more sales. There are many metrics a marketing team can track (see section below). Most C-suite executives are willing to spend money in marketing when they know how marketing efforts are helping grow revenue.
Traditionally, CFOs and many CEOs come through similar programs—an MBA with an accounting or finance focus. Because of the overlap in the education path, these groups tend to speak the same language, whether it’s using the same deck to present information or looking at financial spreadsheets in the same way.
If you are struggling with building trust with the rest of the C-suite as a CMO, learn to speak their language. If you can do that and get on the same page as everyone on the executive team, it makes it easier to build trust and align on marketing plans. The CEO, CFO and CMOs all want one thing–to generate revenue and profit. As the CMO, you can build trust with the team when you report on the specifics of your marketing efforts, how the budget is being spent, and how your campaigns are helping the business reach ist overall revenue goal. Communication is key and knowing which goals and metrics your CEO and CFO care about can help you prioritize where you spend your time as a CMO.
Collaborating with the CFO
Interestingly only 44 percent of C-suite members say they trust one another. The CFO is one of the executives CMOs should be communicating with the most. Because your CFO is managing every dollar, what you do affects each other. It’s important to nurture this relationship.
In finance, things change quickly.
“What was true 12 months ago for marketing must be totally different 12 months in the future in order to grow quickly,” said Rachel Hofstetter. “Maintaining an ongoing relationship allows you to quickly analyze your efforts.”
Working with the CFO, you can pull customer acquisition numbers on a given day, put them through your forecasting model, and determine how that trend will leave you at the end of the month.
If everyone is on the same page, and if you know early what the forecast will be, you can pull back and change things, or you can lean into something that’s a great trend. As you discuss these outcomes and forecasts with your CFO, you can ask questions like, “What will this do to our cash?” and “What can we play with here?” Especially during high growth, having strong financial knowledge and the ability to pivot quickly is what can drive exponential growth. This can only occur when executive members are on the same page and speaking the same language.
Shared Metrics and KPIs Between Finance and Marketing
According to Rachel, “There are no vanity numbers among executive team members.” So what numbers truly matter?
Let’s talk through an important metric called customer acquisition cost (CAC).
The general idea is “What did it cost to acquire a customer?” and if you want to get really in the weeds, you can break that down to “What does it cost across all of our channels?” or “What does it cost on any individual channel?” Every CMO should know on any individual channel—and probably two levels deeper than that—what it costs to acquire a customer because they’re comparing all the different options of where to deploy their resources.
Customer Acquisition Cost (CAC)
CAC on its own does not tell you a whole lot unless you’re going to make decisions on a margin. Some costs you may consider when developing your margin:
- Marketing and advertising costs
- Sales and marketing salaries
- Technology and tools
- Content creation and management
- Market research
Ultimately you’re answering the question: “What does it cost—all in—to acquire a customer?”
Let’s run through an example. Say your fully loaded sales and marketing budget for a month is $100,000 and you acquire 100,000 customers. You would say your fully loaded CAC—or your all-in CAC—is $1. However, that isn’t the complete picture. For instance, if you acquired a customer for $1, but they only spend one penny per month, or say they spend two pennies per month, but your gross margins are 50 percent, what you net from that customer is one penny per month. Based on those numbers, it will take 100 months to pay back the cost of acquiring that customer.
CAC Payback
To go deeper, let’s focus on CAC payback, which is the entire cost it takes to get a customer with the consideration of how much money you actually get back. Ask yourself, “What do I get in my pocket after the marginal costs for that customer have been paid for?”
Let’s focus on another example. Say a customer gives you $1, but you have to spend $5 providing them a service. At the end of the day, you have $5 left in your pocket. If you paid $40 for that customer, all in, it will take you eight months to get all that money that you outlayed to acquire that customer back in the door. That is CAC payback.
CAC payback is an important metric to discuss with the CFO to show how much ROI you are getting on your marketing spend.
The Power of Post-Purchase Survey
The holy grail for marketing is when you get to the channel-level CAC, and you’re evaluating which channels are driving growth efficiently. This is often very difficult. CEOs, CMOs, and CFOs are all trying to figure out “How do I fund more of what’s working and driving efficient growth, and how do I stop all of the other 50 percent of spend that looks great but doesn’t drive customer acquisition.” Full-funnel attribution is the pinnacle for a marketing leader, and it should be the holy grail for a CFO too.
The question is how do you tackle attribution across channels?
Rachel Hofstetter said during the 2023 Growth Summit “After spending many millions of dollars and working through all the attribution strategies, the thing I found that gave us the most clarity into what was really working—and by that I mean if it told us that something was working, and we put more money and more resources into that channel—is a postpurchase survey.”
When you ask customers how they learned about you, this is a strong indicator of channel success. A survey can highlight channels you might not have realized were being successful, such as PR, or help you better map the customer journey.
Post-purchase surveys are most effective when they are conducted soon after purchase. Providing the findings of your survey to the other executives will help them understand which channels are working.
Knowing When and How to Experiment with Marketing Dollars
Much of marketing is “business as usual,” or doing the things you know are working. Finding the balance between business as usual (BAU) and when to experiment can be challenging. CFOs and CEOs may question experimental tactics, but without testing you cannot determine underdeveloped channels, develop stronger messaging, or find new customers. For a high-growth company, a split of 70 percent of your resources going to BAU and 30 percent going to experimental strategies can be the way to go.
“The reason we experimented so heavily on experimental is because the world changes, and things may work but then stop working, or new, better things become available,” said Rachel.
With a defined amount for both BAU and experimental marketing, there is less friction between executives over new marketing strategies. Rather the focus is on the BAU accomplishments with experimental strategies serving as the icing on the cake.
Finding the right mix for your business will depend upon your organization’s size, business goals, and everyone’s buy-in. However, most of your budget should go toward things that you know are going to perform.
Experimental Marketing Strategies
Like venture capital, you only need a couple of wins to make it all worthwhile. Success can be measured via the metrics set up by the CMO and executive team.
How long should you test an experimental strategy? Again, this can vary depending on your resources, budget, and goals. It will require evaluating the channels you are using and the time it typically takes for a response on that channel. It will also require a deep dive into your sales cycle, and win closed rate cycles.
Your experiment may include the following:
- Trying new messaging
- A/B testing
- Using a different channel
- Scheduling during different times of the year
The key is to continue to collaborate with your CFO to understand the success of your campaigns and know when to pivot. Staying agile will allow you to make changes quickly when necessary.
When a Marketing Strategy Doesn’t Work
611 billion dollars are wasted on poor marketing efforts in the U.S. each year. There are many factors that can contribute to the failure of a marketing campaign:
- The wrong channel
- Not enough money was spent
- The wrong creative for the audience
- Incorrect messaging
- Timing
Before starting any new campaign, build a business case. Research and forecast the following:
- Assumptions from cost per lead to the conversion rate
- The traffic that hits the website
- The eventual cost of acquisition as the customer moves through the funnel
- Any additional details or metrics that will help you determine if this campaign is worth it
By starting with a business case, you can identify aspects you may have missed at the end of the campaign. Was the traffic too low? Was the cost for a unique visitor too high? Was the cost per lead too much? Could it be a conversion problem? Were the leads garbage?
Rachel said, “The times where we found the greatest success is when finance understands that . . . we’re speaking the same language.”
By studying your business case, you can explain to the C-Suite where your assumptions were wrong. And the next time you go test a similar channel, you can review your report and adapt so you’re not just repeating the same mistakes over and over again. Even if a marketing campaign is less successful than you planned, learning together and keeping communication lines open strengthens trust between all members.
Building collaboration between the CMO and other C-Suite executives is vital for building trust and developing strategies that deliver. This requires speaking the same language as the CFO and CEO. It also requires the CFO to hold CMOs accountable to mutually agreed upon metrics. It requires the elimination of suspicion and a relationship in which information is shared openly. When CMOs learn to work collaboratively with the rest of the team, their efforts are better appreciated, their wins are highlighted, and they are awarded additional resources for future marketing campaigns that drive growth. Afterall, growth is everyone’s goal.
This article features information from the “The Power of Marketing and Executive Collaboration When Driving Growth” session at the 2023 Ampleo CFO & Growth Summit.

How to Buy and Transition a Founder-Owned Business
Mergers and acquisitions (M&A)—specifically, those involving a founder-owned business—can be a very difficult process with many potential pitfalls and opportunities for both buyers and sellers. According to Harvard Business Review, approximately 80 percent of M&As fail, justifying the need for extensive collaboration and negotiation before business deals close.
Let’s discuss the intricacies of buying and selling founder-owned businesses, including some of the strategies one must employ, regardless of which side of the transaction one is on. From sources of capital and preclosure considerations to financing options and postclosure considerations, here is a powerful framework for successful mergers and acquisitions.
Sources of Capital
Before diving into the steps needed for successful M&As, it is important for business leaders to understand the sources of capital available to them. When referring to businesses in general, sources of capital can be categorized into internal and external sources. Here are some of the primary sources:
Internal Sources of Capital
- Revenue: The income generated from normal business operations and sales of goods and services. Retained earnings, which are profits reinvested in the business rather than distributed to shareholders, fall under this category.
- Cost Management: Efficient management of costs can free up capital. This includes reducing operating expenses, improving productivity, and optimizing supply chain management.
- Asset Sales: Selling off non-core or underperforming assets can generate capital for reinvestment in core business areas or other opportunities.
External Sources of Capital
Equity Financing
- Stock Issuance: Selling shares of the company to raise capital. This can be done through initial public offerings (IPOs) or secondary offerings.
- Private Equity: Raising capital from private equity firms or venture capitalists in exchange for ownership stakes in the company.
Debt Financing
- Bank Loans: Borrowing money from banks or financial institutions, typically with a fixed repayment schedule and interest rate.
- Bonds: Issuing corporate bonds to investors, which the company must repay with interest over a specified period.
Mergers and Acquisitions (M&A)
Mergers: Combining with another company can create synergies and access to new capital sources.
Acquisitions: Acquiring other companies can provide access to cash flows and assets.
Grants and Subsidies
Funding from government agencies or other organizations that does not need to be repaid. This is often available for specific purposes, such as research and development or sustainability initiatives.
Trade Credit
Delaying payments to suppliers to free up short-term capital. This is essentially an interest-free loan provided by suppliers.
Factoring and Invoice Discounting
Selling accounts receivable to a third party (factoring) or borrowing against them (invoice discounting) to access cash quickly.
Crowdfunding
Raising small amounts of capital from a large number of individuals, typically through online platforms.
In summary, sources of capital can be divided into one of the following categories:
- Internal Sources: Revenue, cost management, and asset sales.
- External Sources: Equity financing (stock issuance, private equity), debt financing (bank loans, bonds), M&A (mergers, acquisitions), grants and subsidies, trade credit, factoring and invoice discounting, and crowdfunding.
Preclosure Considerations
Buyers are in a very strong position in the M&A market, with an abundance of capital, up to $500M, ready to back privately owned businesses. Sellers should leverage their position to find a partner whose goals align with their own rather than just the highest bidder.
For buyers, standing out requires more than just capital. It is crucial to show unique value and establish trust with potential sellers by being honest, asking appropriate questions, and creating value.
Viewing these early negotiations like “dating” to ensure a mutually beneficial relationship can be valuable for buyers trying to acquire additional business entities. Both parties ought to exercise their due diligence to confidently align strategy and vision, setting up a successful partnership.
For a seller, there are several important steps one must take to ensure that they are getting a good deal:
- Leverage a corporate attorney or certified exit-planning advisor. These professionals can do a thorough evaluation of your company and help business leaders understand the fairness of an offer.
- Work closely with an investment banker (or a qualified and experienced business broker for smaller deals) to handle the negotiations. Sellers do not need to accept the first deal offered to them, and a banker can help business owners find the right fit and assist in the financial elements after the deal is closed.
- Utilize a real estate planning attorney. This can minimize any end-of-deal surprises and help business owners receive deserved compensation for the value of their assets.
- Consult with a wealth planner. They’ll help to ensure personal financial planning as well.
Structuring and Financing
When structuring and financing the sale of a business, there are four approaches to consider: cash, seller equity (or “roll”), debt, and earnouts. Each of these options has pros and cons, and both parties need to carefully consider which works best for their transaction.
1. Cash
For sellers nearing retirement and wanting a clean exit, cash transactions are straightforward and provide immediate liquidity. For buyers, however, cash-heavy transactions can limit flexibility and increase opportunity costs.
2. Seller Equity
When a seller wants to retain some level of ownership, seller equity is a potential structuring option. Leaders maintaining this ownership can help align the interests of both parties and foster long-term collaboration. Though oftentimes advantageous for the seller, this can result in reduced ownership for the buyer.
3. Debt Financing
Leveraging debt can be beneficial for the buyer, as it minimizes the initial cash needed to close a deal. However, it can increase the financial burden on the business after the acquisition because of debt repayment obligations.
4. Earnouts
Earnouts link part of the purchase price to the future performance of the business. While this can align incentives, it can lead to complex disputes between parties if performance targets are not being met and may require further deal restructuring.
In addition to these considerations, understanding the difference between an asset purchase and a stock purchase is crucial when making a deal. An asset purchase, often favored by buyers, involves acquiring specific assets and liabilities, offering tax benefits, and reducing exposure to previous liabilities. Conversely, a stock purchase is usually more favorable for sellers as it simplifies the transaction and may offer better tax treatment. The right mix of these two options depends on the goals of both the buyer and the seller, and they both must understand the terms of their agreement to make sure strategic objectives are aligned.
Postclosure Considerations
Shortly after buying or selling a business, ensuring that both parties are aligned on responsibilities and incentives is crucial for success. It is important to have open discussions about compensation, bonuses, control, and other factors before and after finalizing the deal.
One strategy to do this is using a framework like the RACI model (responsible, accountable, consulted, and informed). This framework can help eliminate any confusion about accountability or decision-making and establish clear expectations. Effective alignment on these fronts can facilitate smooth operations and pave the way for shared success.
This article features information from the speakers and presenters at the 2023 Ampleo CFO & Growth Summit.

3 Phases to Successfully Transition and Grow a Family-Owned Business
Over 90 percent of small businesses today are family-owned. Often, companies begin with one generation, and as the original founders prepare to retire, they must make decisions on how to transition the business to a management-led organization.
Navigating through the transition-consideration and implementation stages of a company transition smoothly requires an understanding of how family-owned businesses work. Let’s talk about the heart of a family-run business and the three phases of transitioning a business.
The Heart of a Family-Owned Business
At the core of any family owned businesses are founders who built the company from scratch. Their initial goals, values, and mission are reflected in the employees who helped them grow the business. It is also the connection between their business and the clients they serve. Understanding that transitioning a business requires more than just saying, “Here is your new leadership” will help founders make the transition easier and more successful for the entire company.
As founders begin to think about the possibility of stepping down, it’s important to meet with trusted, key stakeholders who have a foundational understanding of the business and company culture. It’s also important to meet with employees to get their take on what should happen next. Achieving consensus in how to proceed can help ensure the success of the company’s continued growth.
Phase 1: Implementing the Plan and Building Trust
According to a recent study, 40 percent of family-owned businesses are planning to transition in the next five years. However, transitioning a business takes time and doesn’t happen overnight. The first phase of transitioning a business should focus on gaining the team’s trust. Putting employees’ needs first and thinking about how changes will affect their careers will help gain the respect of team members.
This is often the first big hurdle to transitioning the business: building trust. While family issues and business issues intertwine all the time, it is important to separate those issues and make sure that there are decision-makers who are empowered to help move decisions forward.
Here are some ways you can implement the first phase of transitioning your family business:
1. Love what you do.
Employees can sniff out which family members in the business are in it for the paycheck and which ones are in it because they love what they do. It’s important for all of the family stakeholders in the business to truly want to do the jobs they have. This builds a stronger culture of trust within the organization.
2. Be real.
If you’re not real, then your team—who watched the business grow from a single truck 50 years ago to what it is today—will see that. Be honest, transparent, and open with your employees so they know what’s going on and can buy in to change.
3. Be aligned.
Family members may disagree when it comes to making decisions for the business. One person may want to grow, and another might not. It’s important for all family members and the employees to be on the same page. Work together to achieve alignment on decisions.
4. Stay humble.
Never forget where you came from. That sounds very simple. However, often in family-owned companies, family members get caught up in the benefits that the family company can provide. Don’t forget what it actually took to get where you are. Recognize the hard work your employees put into the business to help it get to where it is today. Never forget the contribution of your customers, vendors, and partners that went into the success of the business. Keeping this in mind will help you appreciate what you have and where you’re going.
5. Identify your founder mentality.
In order to move from a family-owned to a management-run organization, employees need to understand the founder’s original goals. Ask yourself, “How will these principles be engraved into the next generation of leaders?” Over time, you may find that your key principles evolve and end up looking slightly different from what your founders originally started with. That’s not a bad thing; you can still be aligned with their original intent.
Implementing your transition plan will come with bumps in the road. Keeping these “rules” in mind will help your team to gain the trust and respect of your stakeholders as you continue to grow and transition the business.
Phase 2: Growth and Restructuring
In this phase, companies are typically facing growth challenges. If your business has become too large to have everyone report to the core leadership team, it’s time to consider restructuring the company with a management team to allow for decentralized decision-making.
On average, only 30 percent of family-owned businesses survive the first-to-second generation succession. A successful transition requires a strategy that will ensure success. Moving decision-making from the founders into the departments and areas that are affected will help your business grow.
In this phase of transitioning your business, here are some key concepts to keep in mind:
1. Stay lean.
As a company performs and does better, it is easy to get excessive and forget those lean days when every paper mattered and every item on the invoices was reviewed. Understanding the importance of being lean can help you accelerate catapulting the business to the next level. Stay tight to help manage growth and expansion sustainably.
2. Take risks.
As the family and business grow, that growth puts stress on the organization. By taking risks and growing the company, you can support additional family members, employees, and changing needs. Be willing to take risks that match your company values, goals and mission.
3. Keep the identity and culture of the business intact.
The culture of a family business is woven into everything that business does. If someone steps in and tries to be an innovative leader doing the latest and greatest thing, there may be pushback from the team. Make sure that those traditional elements that the business was built upon don’t change so much that you lose your cultural identity. There is a reason why your company is successful—make sure you don’t fix things that aren’t broken.
4. Facilitate dreams.
Your employees have the same dreams and aspirations as you do. Your employees want to take care of their families and provide for their own kids and grandkids. Be a facilitator of that. Make that happen. As you build your family-owned business, keep this in mind.
5. Implement a decision-making framework.
As the organization continues to grow, it’s important to know who will make certain decisions. For family organizations, this is one of the areas that can make or break a company. The right decision-making structures with the right team will empower you to make educated decisions as you evolve as a company. Don’t become handicapped by not having this kind of structure in place. Many companies fail because they can’t make the decisions or they don’t know who is going to make those decisions. Ensuring that leaders and employees have the skills to navigate challenges will be a big part of your success.
If you’ve already begun transitioning your business, you’re likely experiencing some growing pains. Keeping these five principles in mind will help you better navigate any challenges that occur.
Phase 3: Ongoing Growth and Transition
As the company grows, it is super important to identify the core leaders. Who is running the day-to-day operations? These are the people who make the boots-on-the-ground decisions every day. These employees need to be aligned with the founders to ensure that decisions match the organizational goals and strategies. Key decision-makers who aren’t aligned with those goals will create roadblocks for future growth. To maintain growth and continually improve the transitioned business, you’ll want to create a pool of core leaders to support change.
Here are four ways to identify and leverage your core decision-makers:
1. Find a good fit.
Here are some questions you might ask yourself as you consider people for your core decision-makers: Do they want similar things in their careers? Do they like how the organization is run? Do they like scrappy and crazy or structured boundaries and frameworks? Being fanatical about fit is so important. When leaders don’t fit, it can cost the company time and money.
2. Promote from within.
There are people in your business who have gone through everything with you. These employees are aware and committed to your organization and don’t have any ulterior motives. When you have the opportunity, choose to promote leaders from within. These workers fundamentally know the organization, and their strategies will better align with the company’s goals.
3. Look for evangelists.
When rolling out something new, sometimes employees may give pushback. By including one of your evangelists (one who really believes in what you do) in the initial discussion, they become the cheerleader for the change, and adoption is insane. A senior leader who can relate to the operator in the plant helps champion your changes better than even you can. Leverage these employees’ talent for helping others recognize the good in change.
4. Build up a team of specialists.
As you build your core team, look for blind spots and gaps and find specialists to fill those roles. These experts will execute on a level that will make things happen. If you can’t hire from within, use the “good fit” strategy to see if a new hire will work well with your existing team. Attracting the right talent for your team can enhance your success.
Focusing on these four items will help you be successful in your move from a founder-led company to a company led by a management team. A core team with the power to make decisions without leadership controlling them or micromanaging them will help the organization grow. This will be vital as you continue to transition the business.
Transitioning a family-owned business to a management-led company is more than just a structural shift: It’s a sensitive transformation that requires a thoughtful and empathetic approach. The legacy of the family, the values that have shaped the business, and the personal relationships with employees and customers all contribute to the company’s unique identity and success. A transition that follows the guidelines above can help build trust, preserve the company culture, and ensure a smoother handover, leading to a thriving business even in the hands of new leadership.
If you are thinking about transitioning your business, reach out to Ampleo. Our experts can help you through each phase as you navigate the financial and HR challenges that go along with it.
This article features information from the speakers and presenters at the 2023 Ampleo CFO & Growth Summit.

How to Define the Right Compensation Strategy
Creating compensation packages for employees requires an understanding of motivational psychology, the talent market, and the company’s goals and resources. Companies need to offer pay and benefits that attract and keep top talent while staying within budget and reflecting individual contributions. However, only 23 percent of companies report having a mature compensation structure. The challenge grows as employee expectations shift and the company expands. To stay competitive, organizations must craft packages that are not only fair but also dynamic.
Let’s define what compensation really is, what motivates employees to perform, and some of the key factors you should consider when creating your compensation packages.
What Is Compensation?
A common misnomer about compensation that many business owners have is that salary alone drives employee satisfaction and retention. “Compensation” refers to the reward you give someone for something they’ve lost.
While some owners believe that salary alone is the reason an individual will work for a company, it’s not the only reason that keeps employees engaged and committed. Other aspects—like benefits, work–life balance, professional development opportunities, company culture, and recognition—also play significant roles in overall job satisfaction. Overemphasizing salary without addressing these other elements can lead to high turnover and lower employee morale, as workers require more attractive rewards in their careers.
Counterbalance in Compensation
Nearly 50 percent of employees are considering leaving their jobs in 2024. Compensation is critical, and retaining valued talent can be costly and complex. However, for every decision you make about compensating employees, there are organizational reverberations to consider.
To identify the right compensation package that will keep your team happy, you’ll need to have some knowledge of the strategy, leadership, management, human motivation, company culture, and financial resources of the organization. Each time you consider how you will compensate an employee, you should ask yourself, “What is the downside of this move?” Every reward has both its strengths and its weaknesses. Let’s discuss this a bit more as we talk about what motivates workers.
Categories of Compensation and Motivation
There are two main types of compensation: remunerative and nonremunerative. Remuneration refers to financial compensation. This can be salary, stock options, bonuses, and other payouts that have financial benefits. On the other hand, nonremunerative compensation contributes to an employee’s overall satisfaction and well-being. This could be receiving a title, flexible hours, a company gym, or training opportunities.
As you consider how to compensate your employees, you will need to understand their motivations. Will they perform better with remunerative or with nonremunerative rewards? Or do they prefer a combination of the two?
Beyond financial versus nonfinancial compensation, employees are also motivated by both intrinsic and extrinsic rewards.
Intrinsic Motivation
Intrinsic rewards are intangible benefits that employees gain from their work, often related to personal satisfaction, achievement, and growth. Here are examples of intrinsic rewards employees might seek:
- Career advancement
- Autonomy over work tasks
- Contributing to society
- Positive feedback
- Being part of a team
- Making a difference
- Opportunities for creativity
- Developing skills
- Sense of pride
Intrinsic rewards magnify energy, effort, output, and strategic thinking in employees. Employees who are intrinsically motivated are 32 percent more committed to their jobs. But too much emphasis on intrinsic rewards can feel transactional and reduce self-regulation for your team. These types of rewards work best in a complex, innovative, creative, and rapidly changing environment.
Extrinsic Motivation
Extrinsic rewards are tangible, external incentives provided by an employer to motivate employees. These rewards typically offer direct, measurable benefits and can significantly influence an employee’s satisfaction and performance. Here are examples of extrinsic rewards employees might seek:
- Salary/wages
- Bonuses
- Commissions
- Profit sharing
- Stocks
- Insurance benefits
- Gift cards
These kinds of rewards can help with recruiting the right talent and encouraging competitiveness among employees. However, they reduce creativity and energy in complex problem-solving environments. These types of rewards work best in a mature environment that are simple-task based with a focus on efficiency.
Timing for Compensation Disbursement
Failure to reward employees for performance is one of the top five reasons why employees are leaving companies. The timing of when to compensate is an important factor when rewarding these employees. Pay out a reward too quickly and it can reduce motivation. Drag out compensation and employees feel disconnected to the task they were rewarded for. Finding that sweet spot for the timing of disbursement depends upon the complexity of the task and the working environment.
A delayed disbursement can reduce productivity in employees who have simple tasks such as laying cement. If you wait too long, they feel their efforts were wasted and won’t connect the compensation to the work they completed. However, in a complex task environment such as a rocket launch for NASA, a delayed reward keeps the team on task with a long-term view of their vision and goals.
Understanding the timing of disbursement is an important factor to consider when building your reward strategies. Plan your timing accordingly so employees feel valued but also feel motivated to continue to work on future tasks or long-running projects.
Individual vs. Team Compensation
While every employee wants and deserves to be compensated individually for their hard work, there are environments in which it is more strategic for leaders to consider compensation that motivates employees to work as a team. This works well for sales, product development, long-term projects, and service departments. These packages reward the team’s overall performance and encourage cooperation, shared goals, and mutual support among team members. Here are examples of team-oriented compensation packages:
- Project completion bonus
- Team performance bonus
- Group achievement award
- Team outing
- Celebration parties
As you consider what you are trying to motivate your employees and teams to do, ask yourself the following questions:
- Will this create competitiveness between members? Is that a good thing or a bad thing?
- Will this drive innovation or stifle creativity?
- Will this improve accountability or cause team members to pass the buck?
Again, remember that each decision you make has a counterbalance within the organization. Be sure to consider all sides before implementing a new compensation structure.
Designing the Perfect Compensation Structure
Companies that have the right compensation plan see a 53 percent decrease in their employee turnover rate. What is the perfect compensation strategy? It’s the one that fits your organizational culture, doesn’t strain your financial resources, recruits the best and brightest talent, and motivates employees to give their best. The moment you hire a new employee is the best time to understand what motivates them. What drew them to you in the first place? Was it the salary? Did they request additional vacation time as part of their offer? Did they ask about your company culture? Did they ask about potential for growing with the organization? These are strong indicators of what will motivate them in the future.
A company with a strong compensation strategy will consider both financial rewards and nonfinancial rewards, pairing a fair salary with a positive employee experience. To attract new talent from a competitive pool, focus on differentiation, whether it’s offering employees more opportunities to make an impact in their community, work with a fun-loving, hardworking team, or access to fun company perks like a soda machine and ping-pong table.
You cannot align your rewards if you don’t know your people. Understanding what motivates them both intrinsically and extrinsically, knowing when to reward them, and recognizing when to motivate the team or the individual will ensure that you’re delivering compensation that keeps attrition rates low and delivers strong performances from team members.
This article features information from the speakers and presenters at the 2023 Ampleo CFO & Growth Summit.

3 Levers to Boost Enterprise Value
Prioritizing a company’s enterprise value is key to all aspects of the business—including enhancing its financial condition, influencing culture, driving sustainable success, and maximizing the future selling price. However, boosting enterprise value is easier said than done—not to mention how time-consuming it can be. It’s a common question in entrepreneurship: How can business owners create value for their business in the most effective, profitable, and beneficial way?
In this article, we’ll summarize some of the takeaways Jeremiah Jewkes presented at Ampleo’s 2023 CFO and Growth Summit for why a merger and acquisition strategy is a powerful tool that can supercharge enterprise value, as well as three key levers that can help you boost the value of your M&A plan: utilizing debt in your favor, creating revenue and cost synergies, and developing a valuation multiple. Let’s dive in.
Why Use M&A to Increase Value
Deploying a merger and acquisition strategy is one powerful way business owners can create value for their companies, especially in middle-market businesses. According to EY-Parthenon, there is a strong positive correlation between M&A and enterprise value and total shareholder return. Frequent M&A activity can not only generate tremendous value quickly but also provide an alternative to slower growth strategies, such as hiring new sales reps and sales teams.
For example, let’s say Business A has $1M EBITDA and a value of $10M. Business A acquires a smaller company, Business B. If Business B has $0.5M of EBITDA for 4x and a purchase price of $2M, it would generate an additional $3M of value for Business A. After the acquisition, in total, Business A would have a value of $15M, all generated by buying one company.
Beyond simply making acquisitions, business owners can capitalize on mergers and acquisitions to accelerate their enterprise value by strategically using three additional levers. Here’s how.
1. Use of Debt in the Acquisition
Companies can accelerate the value of an acquisition by using debt to fund the purchase price. Instead of using cash from operations or equity, using debt can help you generate more value without using the capital of your business. This is a cheaper option for a company than equity, partly because it doesn’t require issuing shares.
Imagine that Business A either partially or fully funds the $2M purchase price of Business B with debt. In this case, if Business A decides to sell the business five years later, it can generate arbitrage value without deploying its own capital.
2. Revenue and Cost Synergies
Similarly, making strategic acquisitions that fit your vertical and complement your business can help you create revenue synergies that boost enterprise value. In this case, your company can offer value at every stage of the cycle to find new customers, increase the cost of your services, and generate revenue.
When you achieve this, each dollar of sales is enhanced by scale, pricing power, and cross-selling other products, driving more value than you originally paid for. Revenue synergies are often seen in healthcare. For example, dental practices often aggregate to increase the value of the fillings they offer, enabling them to charge more for their services because they are a bigger organization.
Cost synergies can work in a similar way as revenue synergies to reduce costs and increase the value of acquisitions. Identifying and eliminating duplicate systems, contracts, and employees is a powerful way to dramatically increase EBITDA and maximize the benefit of your acquisition.
3. Valuation Multiples
This is the holy grail of value creation. Multiples compare a company’s earnings and cash flow to its enterprise value, providing a great measurement to concentrate on throughout the M&A process. With valuation multiples, every dollar of earnings could be worth 11 or 12 times more, all depending on the value your business offers to the buyer.
For example, a combined business may be worth more than 10x EBITDA due to its scale, strategic relevance, scarcity, or influence. Scale has value in the marketplace, as big companies are often worth more than smaller businesses. Similarly, strategically offering more service lines or changing the competitive landscape can multiply the value of your business, enabling you to utilize a valuation multiple increase. That is multiplicative in terms of the impact on the business.
Maximizing the value of a merger or acquisition to drive the most enterprise value for your company requires careful consideration and expert guidance. At Ampleo, our team of seasoned consultants is equipped to help you navigate through the complexities of enterprise value and M&A, driving your business toward explosive growth.
Reach out to us to start increasing your enterprise value today.
This article was written based on the session conducted by Jeremiah Jewkes at Ampleo’s 2023 CFO & Growth Summit.
You've Got the Vision.
We've Got the Fractional
Team to Build It.
A fractional CFO who knows your numbers. A fractional CMO driving your pipeline. An HR leader building your people systems. Sales tax specialists keeping you compliant. Valuation experts ready when you need them. All embedded. All executing. All backed by Ampleo Intelligence, our AI platform.
You've Got the Vision.
We've Got the Fractional
Team to Build It.
A fractional CFO who knows your numbers. A fractional CMO driving your pipeline. An HR leader building your people systems. Sales tax specialists keeping you compliant. Valuation experts ready when you need them. All embedded. All executing. All backed by Ampleo Intelligence, our AI platform.
You've Got the Vision.
We've Got the Fractional
Team to Build It.
A fractional CFO who knows your numbers. A fractional CMO driving your pipeline. An HR leader building your people systems. Sales tax specialists keeping you compliant. Valuation experts ready when you need them. All embedded. All executing. All backed by Ampleo Intelligence, our AI platform.
You've Got the Vision.
We've Got the Fractional
Team to Build It.
A fractional CFO who knows your numbers. A fractional CMO driving your pipeline. An HR leader building your people systems. Sales tax specialists keeping you compliant. Valuation experts ready when you need them. All embedded. All executing. All backed by Ampleo Intelligence, our AI platform.






