Ep. 147 — Ilan Jacobson: Sell Now, Or Plan for Fifteen Years

5 min read

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Episode Summary

You’re 62. You’ve heard the boomer wave headlines for a decade and assumed you had runway. Your banker offers you a loan if you put up 100% collateral, which is not actually a loan. Your CPA hands you the tax return and goes home. And nobody is sitting next to you reading the actual capital landscape you’re operating inside. I sat down with Ilan Jacobson, co-founder of Firepower Capital in Canada, who built a 40-person shop that does private growth lending, M&A advisory, and private equity buyouts under one roof. We got into why banks understand balance sheets but not income statements, and why that gap is starving good cash-flowing businesses that can’t get funded. We got into the $5.7 trillion raised by PE since 2015 and the $3 trillion still sitting on the sidelines, and what happens to multiples when that capital has to find a home. We got into Ilan’s call on timing: sell now or in the next two years, or plan to sell in fifteen, because the window between is where the carnage lives. And we got into why most owners aren’t actually building entities. They’re building themselves with a payroll attached.

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## Top 10 Takeaways
  1. Banks understand balance sheets, not income statements. If your value is cash flow, traditional debt won’t fund your growth.
  2. A 100% collateral “loan” isn’t a loan. It’s a risk transfer with an interest rate attached.
  3. Normalized cash flow matters as much for lending decisions as normalized EBITDA matters for sale decisions.
  4. The supply of good companies is limited and demand is gluttonous, which is why multiples are temporarily insane.
  5. Going from $4M EBITDA to $8M over five years can leave your enterprise value unchanged when multiples compress.
  6. Sell in the next two years or plan for fifteen. The window between is where the carnage lives.
  7. Below $2-3M EBITDA you get retail advisors, no bank financing for transitions, and no PE attention. You’re on your own.
  8. Buyers buy entities, not individuals. If your business dies the day you stop showing up, it’s not sellable.
  9. Don’t rationalize the lost client or the lost deal. The owners who survive let it hurt enough to learn from it.
  10. The next wave of buyers won’t be financial engineers. The operators willing to walk the shop floor will win.

Sound Bites

“$5.7 trillion have been raised by private equity since 2015. I think $3 trillion is sitting on the sidelines.” (@TBD) — Ilan Jacobson

“I would sell now or in the next two years, or I would sell in 15 years. I think there’s going to be some carnage between five and 15.” (@TBD) — Ilan Jacobson

“People don’t invest and they don’t buy individuals. They invest and they buy entities. So if your business is reliant on you and you got hit by a bus, the thing would die, figure out ways where that’s not the case.” (@TBD) — Ilan Jacobson

“I cannot stand people who lose a deal or lose a client and then somehow rationalize it to themselves by saying, oh, we didn’t really need that client. That’s a recipe for disaster.” (@TBD) — Ilan Jacobson

“We were juggling a quarter million dollar payroll every two weeks. There was like 25 times that we didn’t have enough money. We always made it. There will not be anything that I do in the rest of my life that is harder than that.” (@TBD) — Ryan Tansom

About This Episode

Ilan Jacobson is co-founder and CEO of Firepower Capital, one of the largest independent mid-market M&A shops in Canada. He started in 2009 with a desk, a chair, and a phone after leaving venture capital, and built it into a 40-person firm spanning private growth lending, investment banking, and private equity. Firepower has done $241M+ in private lending since launching that program in 2016 and $500M+ in investment banking transactions since 2013. Ilan is also the owner of Battle, the largest axe throwing company in the world, plus a portfolio of operating businesses. He brings a no-BS operator’s view to the capital markets that’s rare among financiers.

Resources Mentioned

  • Firepower Capital — Ilan’s firm. Private growth lending, M&A advisory, and PE under one roof.
  • Battle — The world’s largest axe throwing company, owned by Ilan.
  • Capitalism Without Capital — The book Ryan referenced on why the banking system is built for tangible assets that no longer dominate the economy.
  • Ken Sangenario — Value Opportunity Profile — Referenced for tying company-specific risk into discounted cash flow valuation.
  • Ray Dalio — Referenced for the big debt cycle thesis.
  • ITR Economics — Referenced from a previous episode for the 10-year forecast and timing call.
  • Vistage — Referenced as the peer group network for 25,000+ business owners.
  • Profit First — Referenced in Ryan’s outro as a common-sense layer on small business cash management.
  • Axial.net — Mentioned as the next episode’s topic with co-founder Peter.
  • Ilan on LinkedIn — Ilan’s preferred contact channel.

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