In today’s episode, our guest is Aryeh Sheinbein, Managing Director with Alvarez & Marsal’s Valuation Services practice and a member of the Alternative Investment Services group. Aryen has over 20 years of expertise in the financial services industry, having held senior roles in private equity and hedge funds, as well as valuation consulting firms. He advises private equity businesses, hedge funds, and business development firms on valuation (BDCs). His knowledge includes appraising private equity fund portfolios of illiquid stock holdings as well as the underlying equity valuations of portfolio firms. And today, he’ll reveal business concepts you didn’t know you were aware of.
[3:03] Why should we listen to you?
I would probably not start talking about myself. I’d probably try and get to know you and talk about you. So I don’t think there would be anything to tout myself as to why you should listen to me. But I have four kids and have been married for over 20 years, so I guess I have some experience in that realm. In terms of business, I have been doing finance stuff for 20 some odd years. Other than that, I’m more of a listener rather than a talker. I prefer to listen and to talk.
[5:57] Integrity in Work
I don’t think I’m alone in thinking that there are people who aren’t completely honest, but I believe that for the most part, people are honest. However, when I’m dealing with clients, whether selling or advising them on the value of a business or an investment, I know that they are aware that I may not always tell them what they want to hear.
[8:55] Daily Work
I describe it as simply as possible because I get hired by private equity firms, hedge funds, and all kinds of asset managers. They want me to help them value businesses or investments that they’re making that aren’t necessarily like public information. And then we’re going to work with them to help those businesses or those investments be worth more.
[10:45] Valuation of Business or Work
I think there are a few things that you said that are important. And then you can kind of break down and get into the weeds on some of these things. The most important thing is that history isn’t irrelevant, but it’s not what they’re buying. Cash flows are critically important.
Can I pull a person out? or drop a person in? These things make your business much more valuable. The CEO’s job is to be that visionary, but not to be the day-in and day-out of the business. If you have a physical product business, you can email these people, mail them or call them or get in touch with them.
You may reinvigorate them even if they haven’t bought in the last two weeks, a month, or however long it has been. From a conceptual standpoint, you must detach yourself from the day-to-day operations and make them more valuable.
[15:30] Lion’s Den Podcast
I didn’t realize how entrepreneurially driven I was until I got this job. I think many people get into a business or want to get into business. And there’s something that they don’t know about it. And there are many things you didn’t even know that you shouldn’t have. So the idea is that when you have someone who’s gone through something, you will be able to extract that information from them and educate people and bring it to people.
[19:47] What’s the hope for the world with the podcast?
When I started, it was one thing, and now it’s pivoted and shifted to another. And that is as people get access to other people’s stories, it’s a connection matter. It builds that trust for people to say this guy has some value to bring to me. I want to understand least like what to do with my money or understand it. I know that I can potentially talk to this guy and feel reasonably trustworthy from it.
[22:33] What promise did God make to the world when He created you?
That I will leave it a better place than I came into it.
[4:15-4:22] “A lot of times, people are nervous about making that connection because of the stereotypical and the negative bias that comes with it.”
[9:38-9:43] “When they’re investing, they’re looking for a financial return because they’re going to they’re going to exit it at some point.”