Private equity deal flow up in Florida

In today’s uncertain world, just do the right thing. It’s good for business

By James S. Cassel

With so much noise and confusion surrounding the current political, business and economic climate, middle-market business owners are unsure how to protect the best interests of their businesses in the short and long term. The simple and common-sense answer: No matter what anyone else may be doing, you should continue doing the right thing, and support like-minded companies that do the right thing.

While it may be true that there are too many regulations, the fact is many are very important and necessary. The current administration has been reducing regulations (some believe  indiscriminately) without really considering the true long-term impacts of these decisions. This might be great for business in the short term, but it could hurt significantly in the long term. So, we reduce regulations but we damage the environment, consumer protection, endanger people, or curb protections — how does that help anyone? It is shortsighted.

What can you do? Continue to run your business with the highest moral and ethical standards of sustainability and social consciousness — and choose to do business with companies that do the same. In this way, beyond protecting your business, you will exert influence in very positive and powerful ways: rewarding the do-gooders by supporting them financially, while letting the negligent ones feel it in their bottom lines.

For example, our government has reduced incentives for alternative energy — including solar and wind energy — in the recent tax code, which may be good for the coal, hydrocarbons and energy industries, but may not be good for the environment and for business. Additionally, the reduction of many of these regulations is chipping away at consumer protection. Again, you can lead by example and with your wallet by only doing business with companies that do the right thing.

One positive step that you might take with the extra money you will probably receive from the recent tax breaks is to apply it to environmentally friendly, sustainable, socially responsible initiatives. Additionally, you might invest in marketing programs to promote your sustainability policies and elevate your profile as a good steward of our environment, motivating others to follow suit. Look at shoe company TOMS or eyeglass company Warby Parker, two companies that since their founding as startups have provided one pair free to someone in need for every pair purchased.

Already, a growing number of companies are leading the charge. Consider Coca-Cola’s widely promoted “World Without Waste” packaging vision, which involves gathering and recycling a bottle or can for every one sold around the world by 2030 and renewing its focus on the entire packaging life cycle.

Dunkin’ Donuts recently announced its commitment to eliminate all foam cups by 2020, a highly responsible act. These initiatives are not only good business but vital for our planet. More companies should follow their lead.

At the same time, firms like Blackstone, one of the nation’s biggest asset managers, is making it clear to companies that it wants to invest in companies that are socially responsible. Its mission is clearly articulated on its corporate website, which reads: “Protecting the environment of the communities in which we operate is critically important. Fostering growth and creating enterprises of enduring value is a vital part of Blackstone’s commitment to being responsible corporate citizens. Our commitment to corporate responsibility is embedded into every investment decision we make.”

While bigger businesses like these have endless options and resources, middle-market companies should do their part within their own spheres of influence. Additionally, being socially conscious and socially responsible increases long-term value. You do not have to pay to clean up what you do not mess up. If you are going to sell your business, building sustainability as a socially responsible company can enhance the value of a sale as more private equity firms and investors look to ensure they are dealing with quality, responsible, sustainable companies.

Like it or not, while it can be nice to get extra money and live in a bubble, we are only fooling ourselves and hurting future generations by only considering the short term.

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How To Know If It’s The Right Time To Hire

By Bryan Borzykowski

James Cassel has hired hundreds of people to work at the various companies he has helped start and run over the past four decades. Still, after all that time, the lawyer and investment banker says knowing when to staff up remains one of the hardest parts of being an entrepreneur.

“We struggle, as do many small and medium-sized firms, in deciding when to hire that additional person,” said Cassel, chairman and co-founder of Cassel Salpeter & Co., a Miami-based investment bank.

These days, Cassel takes a slow and steady approach to hiring. Since he started his current company seven years ago, Cassel and his colleagues have brought on only eight people, in addition to the four who started the firm. With previous companies, he would hire quickly, only to have to lay those people off when work dried up during the recession.

“I’ve had the pleasure of bringing in great people and the angst of letting those good people go,” he said.

Knowing the precise time to hire a new employee is a constant headache for business owners. Challenges include not only finding the money to pay the new person’s salary and benefits, but also keeping him or her busy, motivated and contributing to overall productivity.

Hiring is like a puzzle, according to Sara Whitman, chief culture czar at Pepercomm, a New York-based communications firm. It’s a process of constantly seeking the piece that fits. “You’re always moving things around to get the picture,” Whitman said. “And once you get it right, you have to move it around again.”

It All Comes Down To ROI

Deciding when to hire comes down to one thing: profit. Can another employee help you generate more profits now or not far down the road? That’s the question all business owners should ask themselves, said Richard Allaway, general manager and division vice president at ADP National Account Services. “Get out the spreadsheet and the calculator,” he said.

The answer isn’t always a simple yes or no, though. Numerous factors play into the equation. What’s the best way to generate that profit? It might be by landing a new customer, in which case you may need a sales or business development person. Or maybe it’s by filling orders more quickly, which means you’ll need someone in operations who can speed up the production process. Maybe you’re trying to accelerate the launch of a product, so you’ll need to hire someone in product development. It depends on what kind of help the business owner needs most, Allaway said.

An Investment In Your Business

Cost is one reason companies wait too long to hire. Employees are expensive. Besides salary, companies also need to shell out money on overtime, benefits plans, potential 401(k) matches and so on. But an organization that focuses only on cost of employees would never hire. Instead, an organization should look at new hires as an investment, as long as it can afford to finance additional headcount until profits grow. “It could be months before people pay for themselves. So you have to have the capital to fund that growth,” Allaway said.

In many cases, especially for service companies, hiring depends on how many clients are coming and going. An expanding client roster largely drove Pepercomm’s growth from a dozen at launch 30 years ago to 100 people now. “A lot of times hiring is driven by the business,” Whitman said. “When you win a new piece of business you might need another body to help fulfill that work.”

In recent years Pepercomm has become more analytical when it comes to hiring. Today, it has four employees who assess the organization’s overall needs and, starting with that assessment, decide where to put existing staff and what holes they need to fill with new hires.

They analyze budgets to see how much money the organization is spending on people costs versus expenses such as rent and equipment. How many people are working on certain client accounts is another matter for inquiry. If the data indicates they need to hire, they will, Whitman said. If it indicates that they require only part-time help, they’ll look for freelancers they can employ on a temporary basis.

The Importance Of Due Diligence

Deciding when to hire is a decision organizations shouldn’t take lightly. You might feel like you need help, but hiring out of frustration or desperation isn’t a good strategy.

“If you hire the wrong person, it could introduce some risk or liability,” Allaway said. “Maybe you end up with someone not as skilled as you and they treat a customer badly or you have to let them go and give them a severance. These are things that can impact the business financially.”

When you do get it right, though, your business — and profits — can soar. “Hire a great employee and they can grow the business beyond what their expected contributions might be,” he said.

For Cassel, the key is adding new bodies only when he’s confident it might help move his business forward.

“If you’re looking to build on your business plan, then you try and match the right people who can help you execute on that plan,” he said. “Hire the right people who fit the culture and can help the company in the future.”

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Sense of the Markets: IPOs on Ice Amid Volatility

After January 2018 racked up the most deal volume by dollar amount ever, February could see a bit of a respite as firms looking to list wait for enormous market swings to settle

By Kinsey Grant

In a market rife with volatility, going public doesn’t scream “logical” and after a January that saw almost 80% more volume than the previous year, February’s volatility may have put the IPO hot streak on ice.

The Dow, S&P 500 and Nasdaq have endured wild swings in value over the past week that have led the Cboe Volatility Index to rally 80% in the past five days. While that enormous volatility has quieted some Wednesday, Feb. 7, the market has yet to return to the ultra-low volatility nature it maintained throughout 2017 and into January.

Because of that, the IPO landscape could simmer down some as firms looking to list wait for a more even-keeled environment in which to do so. February’s quiet spell comes after January 2018 won the title of the biggest start to a year on record in terms of dollar IPO value. Last month, there were 20 IPOs in the U.S. valued at $9.266 billion total, according to data from Dealogic. There have been three IPOs in the month of February so far, valued at a total of $908 million.

IPO action was especially slow last year, Cassel noted. Deal value in January 2018 topped the same month a year earlier by 79%. In January 2017, there were about half the number of IPOs listed in the U.S. For the whole of February 2017, there were six listings total valued at $710 million.

“Obviously when people are doing IPOs volatility is not something they like, especially the underwriters,” said James Cassel of Miami-based independent investment banking firm Cassel Salpeter & Co.

“People who were probably ready to go might have held off,” Cassel said of February’s swings that have seen the Dow open lower 500 points only to nish the session in the black.

“[Volatility] is not great for IPOs because nobody knows where anything is going,” said Heidi Mayon, partner at the Silicon Valley office of Gunderson Dettmer. But if the process was by and large complete, the IPO show must go on, Mayon said.

“People will wait,” Cassel added. “And then they’ll come back out. You have a lot of pent up demand.”

Some market watchers have called for sustained volatility throughout the rest of 2018, but that likely won’t impact IPO action for the next 10 months. Cassel said IPOs won’t be held off much by 100-point swings in the market. It’s really only the 1,000-point swings like the market endured this week that are enough to delay an IPO.

As for this spate of swings, it was a long-time coming, Mayon said. “Everyone kind of expected some kind of downturn.” But all in all, the market is healthy, Mayon said. “We’re seeing really strong interest in IPOs as a whole.”

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Liquor Sector to See More Consolidation in 2018

The Patrón and Avión tequila purchases likely will not be the last deals this year for producers of tequila, whiskey and gin.

By Cathaleen Chen

So much for dry January.

So far this year, there have been two major deals in the spirits industry: Bacardi Ltd.’s acquisition of Patrón Spirits International AG, and Pernod Ricard SA’s purchase of the remainder of Avión Spirits LLC, both hip-hop- approved tequila brands.

Thanks to heightened consumer demand and the fragmentation of liquor brands now offered on the market, the industry can expect to see even more mergers ahead, industry sources said, especially among whiskey, tequila and gin producers.

“Being acquired by a major player is the dream for people who build these smaller brands,” said Ken Austin, founder of Avión. “Typically, what happens for them is they get to second base, and to bring it home, they try to get acquired.”

Part of the obstacle to scaling up for growing brands is the issue of distribution, as U.S. regulatory measures largely prohibit direct-to-consumer outreach from distillers. Instead, in a three-tier system, wineries and distilleries must go through distributors, or wholesalers, to reach retailers — stores, bars and so on — which only then access the consumer.

“It’s a really challenging space for smaller brands to build architecture because there are so many channels of distribution you must populate,” said Derek Benham, founder of Graton Distilling Co. as well as multiple wine brands. Graton, based in namesake Graton, Calif., produces D. George Benham’s Sonoma Dry Gin, Redwood Empire American Whiskey and D. George Benham’s Vodka Vodka, the latter not a typo but a “vodka-flavored vodka.”

“Each of these distribution channels requires a different type of investment and expertise, and it’s always a battle because when you get to this second tier, you’re battling the huge brands with [deep pockets] for market share,” he said. The solution, then, is to be acquired by a large player, such as Pernod or Constellation Brands Inc. (STZ).

The spirits industry, across the board, is in a sweet spot, and the stock charts say it all. Jack Daniel’s, Herradura and Finlandia producer Brown-Forman Corp. (BF.B) , for instance, has seen shares skyrocket more than 52% in the past year. Stock in Constellation, home of Casa Noble tequila and High West whiskey, not to mention Corona, Modelo and Pacifico beer, is up more than 46%, and shares in Pernod (Jameson whiskey, Beefeater gin, Absolut vodka) have jumped more than 16%.

The reason for investors’ love of spirits producers is that alcohol consumption in the U.S. is higher than ever. According to an August study published in medical journal JAMA Psychiatry, alcohol use rose from 65% of the adult population to 73% in a 12-month period.

Not every drinker, of course, toasts with the same drink — and the strongest consumer segment, according to Austin, is millennials.

“The younger consumers are looking for better products. They want to know the story behind a brand, they want to understand the taste profiles, and they don’t want alcohol with artificial ingredients,” he said. That’s why, he added, small, local distilleries are on the rise.

According to bar analytics firm BevSpot Inc., the three most ordered spirits are whiskey, vodka and tequila. Whiskey and tequila in particular are seeing a number of deals, said Jim Cassel, co-founder of investment banking firm Cassel Salpeter & Co., but gin is the up-and-comer.

“One space that hasn’t seen a lot of M&A is gin, but there are a lot of smaller gin brands out there now,” he said, pointing to The Botanist, made by Scotland’s Bruichladdich Distillery Co. Ltd., as an example of a brand that’s gaining traction. Bruichladdich, however, is owned by Rémy Cointreau Group, the French entity behind Rémy Martin cognac and Cointreau liqueur.

As for future acquisition targets, Benham pointed to the Michter’s whiskey brand of Louisville, Ky., and Sonoma, Calif.’s 3 Badge Beverage Corp., which produces a range of spirits and wines, as two of the few distilleries that remain private.

“We are a dwindling species!” he said. “The ones that haven’t been bought are tiny companies.”

As for his own company, Benham said, “If something comes along that’s a generous offer that makes sense, as a businessman I’ll look at it.” (He previously sold the Mark West wine brand to Constellation in July 2012 for $159.3 million and the Blackstone and Codera brands in October 2001 to a Constellation joint venture for $138.1 million.)

There also could be larger consolidation deals down the line, such as Constellation swallowing Brown-Forman, Benham added. Other smaller liquor companies that remain private include Jose Cuervo, Bushmills and Hangar 1 maker Proximo Spirits Inc. and Heaven Hill Distilleries Inc., producer of Evan Williams bourbon and Christian Brothers brandy.

But there is another elephant in the room: Tito’s Handmade Vodka, the Austin, Texas, distillery that makes what was recently billed as the world’s fastest-growing vodka. Founded 20 years ago, Tito’s went from producing 150,000 cases in 2006 to 2.78 million in 2015, according to Impact Databank. Between 2016 and 2017, Tito’s sales grew 44% to nearly $190 million, becoming,the top-selling spirits brand in the U.S., Wine & Spirits Daily reported last October.

The company has remained private under founder and sole owner Bert “Tito” Beveridge.

“I’m sure the guy gets calls multiple times a week. It’s grown almost logarithmically,” Benham said. “But what I’ve heard is that he’s just not willing to sell.”

Tito’s could not immediately be reached for comment.

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Prepare now for impacts of new tax bill on middle-market businesses

By James S. Cassel

While many hope the new tax bill will stimulate the economy and bring faster GDP growth, we must consider whether it will indeed benefit us to speed growth from where we are today, or to experience a longer period of extended slower growth. Will the stimulus cause the economy to overheat and therefore bring us closer to the next recession? Are we better off as the tortoise or the hare? Fact is, middle-market business owners would be wise to prepare for both scenarios.

Since we are not currently in a recession and we have had steady, slow growth for almost 10 years, it is not clear that we need the stimulus this bill is supposed to bring. If we overheat, the Federal Reserve will likely pull back by raising interest rates faster to slow the economy. Rapid growth could cause inflation, because of a shortage of labor in today’s already tight employment market, among other things. Would that mean the Fed needs to raise rates faster (many already predict three quarter point interest hikes in 2018) and push us closer to the next recession, or are we better off with slow, sustained growth? Slow, sustained growth over the long term may be more beneficial to individuals and middle-market businesses.

Based on our experience working with middle-market business owners in all types of economic cycles, here is some general guidance to help your business decisions this year:

Hiring. You should be very cautious and not be overly exuberant when hiring because adding too many full-time employees too fast could put you at risk of having to fire those people just as fast when things slow down or your projections are not met. In the last recession, employers who hired in 2006 had to fire fast in 2008. Those who didn’t react quickly enough may not have survived. The key is to remain quick and nimble, and always hire people for the right reasons at the right times. You may want to start by hiring temporary help or part-time employees with the idea of converting them to full-time if growth continues.

Capital expenditures and real estate. When it comes to your capital expenditures, you must be careful to not overexpand. With real estate, you must be flexible. Consider solutions like WeWork or Regus shared office spaces to avoid long-term real estate commitments, which have proved to destroy many companies. Beginning in late 2000, large real estate commitments doomed companies when the internet bubble burst.

Expenses. You must continuously monitor your expenses and evaluate your medium- and long-term commitments to ensure you have flexibility. You want to continue to keep a strong balance sheet, being cautious with your commitments for borrowing. Particularly during the next year or two with the continuation of the growth of 2017, there is an expectation that interest rates will continue to rise, increasing borrowing costs.

Taxes. While some will get an increase in their taxes, the bulk of the tax relief will go to the wealthiest individuals and businesses, and thus will, in all likelihood, be saved rather than spent. In the case of companies, it will probably be used for dividends or stock buybacks, with limited increases to employee compensation where required to retain talent. Some of the benefits from this tax cut could be very short-lived, and as the bill exists today, individual tax benefits are not permanent.

It will be interesting to see what happens to economic growth with the new tax law over an extended time, because depending on which economist you listen to, forecasts vary from short-term blips in growth to long-term, extended growth. Some of the benefit will be offset by the misguided immigration policy which, as we deport workers, reduces the pool of potential employees. At the same time, in today’s economy that is near full employment, our immigration policy also reduces the pool of consumers who are spending money and in many cases paying taxes, decreasing GDP growth.

Without a doubt, exercising caution and preparing for both outcomes can help protect your best interest in any of these scenarios.


James Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle- market companies. He may be reached via email at or via LinkedIn at

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Bad hire? Fast fire!

By James S. Cassel

Imagine: You hire a new employee but after a few weeks, you realize you made a bad choice. What to do?

Whether the problem is competence or chemistry, or anything else in between, the best advice is to be decisive and act — fast. Some business owners hesitate to pull the trigger because they do not want to admit they made a mistake. Unfortunately, the mistake magnifies with time and does not get better. It is OK to admit you made a mistake in hiring someone. Not terminating sooner rather than later is a bigger mistake.

Firing employees can be difficult for many reasons. As Warren Buffett said: “It’s pure agony, and I usually postpone it and suck my thumb and do all kinds of other things before I finally carry it out.”

Regardless, it must be done. As many of my clients have told me over the years, when you keep around a bad hire or employee it only gets worse the longer you retain them. Moreover, when you terminate a senior-level hire, such as a CEO, and you bring back a former CEO on an interim basis, most of the time that interim CEO will find things worse than they were when he or she left. If things were the same, then you probably would have kept the new hire.

Former General Electric Co. CEO Jack Welch — distinguished as one of history’s most famous managers, and noted for turning the struggling GE into a global giant during his 20-year tenure — was not called “Neutron Jack” for no reason. Indeed, he was known for his aggressive approach to categorizing and promptly terminating employees he ranked in the bottom 10 percent of his workforce, encouraging leaders to automatically fire their lowest performers as part of an annual corporate improvement process.

As part of his “rank and yank” system, managers were asked to group all team members into A, B, and C categories: the top 20 percent, the middle 70 percent, and bottom 10 percent. According to Welch, the middle should be coached and groomed to move up to the ranks of the top 20 percent. The bottom 10 percent, according to Welch, had to go.

Welch innately understood what many business owners neglect to realize: Keeping around poor performers becomes a major drain on your company, costing you money, time and energy, not to mention morale. It also makes things worse for the bad hire. I tell you this from experience.

So, how long should you wait before pulling the trigger? There is no cookie-cutter time line, and you should do it as soon as you realize it.

However, while it is never too “soon” to fire a bad apple, it should not come as a surprise to the person being fired. As Welch said, they should have had an opportunity to hear and respond to feedback. Make sure your employees have well-defined job descriptions and expectations, so they know what is required for success and can minimize the likelihood of failing.

When firing someone, the key is to take ownership of your hiring mistake and implement the right strategy to reposition your company. It is always good to consult with human resources specialists and labor attorneys.

As it relates to high-level terminations, communicate properly with your internal (employees) and external (clients/customers, vendors, partners, etc.) stakeholders. Provide reassurances the company is on track and will continue moving forward as planned. Also, identify what lessons can be learned to avoid the same problem with the next hire.

Bad hires or bad employees are part and parcel of doing business, for any company in any industry. We all make mistakes. Business owners who take timely, decisive action are protecting the best interests of all parties involved — including the bad hire, who is now free to find employment somewhere that he or she will be a better fit.


James Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle- market companies. He may be reached via email at or via LinkedIn at

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Why more banks are launching IPOs

By Jackie Stewart

A bullish outlook on the financial sector encouraged more banks to go public this year.

A number of banks were eager to take advantage of investor optimism after last year’s presidential election. Several had compelling stories built around high flying niches, while others were looking to provide liquidity for investors or create a currency for acquisitions.

Eleven banks have held initial public offerings this year, excluding mutual conversions, or almost double the number that took place in 2016, based on data from Sandler O’Neill. Though down from the 15 IPOs conducted in 2014, a year when post crisis investors pursued exit strategies, momentum could continue if bank stocks remain hot.

“I think the stock market is a factor, but also which banks will have a good earnings growth story,” said Vincent Hui, a senior director at Cornerstone Advisors who oversees the firm’s risk management and M&A practices. “People will buy into you if you have a good earnings growth story. But we will have some headwinds.”

The KBW Nasdaq bank stock index is up about 16% this year, which has spurred more investors to pump more money into bank stocks, industry experts said.

Banks also have cleaner balance sheets and stronger operations compared to the post crisis years, said Brian Sterling, co head of investment banking at Sandler O’Neill.

“If you put together good stories, you’ll get increased activity,” Sterling added. “I do think you have some unusual business models [of banks that have gone public] and different approaches with good management teams.”

Banks with unique business models are also appealing to investors.

Esquire Financial looked at the IPOs at Triumph Bancorp in Dallas and Live Oak Bancshares in Wilmington, N.C., as it was preparing to go public, said Andrew Sagliocca, the Jericho, N.Y., company’s president and CEO.

Triumph, which focuses on factoring and other nontraditional businesses, held its IPO in 2014; Live Oak, a major small business lender and technology innovator, went public the following year. Triumph’s stock is up more than 25% this year, while Live Oak’s shares have increased by roughly 35%.

Executives and directors at Esquire, which has a specialization in offering services to law firms, began mulling an IPO in early 2016 to create liquidity for shareholders and allow employees to take an ownership stake in the company. A publicly traded stock also allows the company to access capital markets more efficiently, Sagliocca said.

“We were in a true inflection point,” Sagliocca added. “There were a lot of institutional investors that wanted to invest in a unique business model. The market conditions were stronger than in the past.”

An increasing number of banks with less than $1 billion in assets are bucking conventional wisdom by going public, said Rory McKinney, managing director and head of investment banking at D.A. Davidson. Such institutions can make the leap if they have strong management teams and returns that are beating out larger rivals.

“Investors are always looking to invest in different types of new stories,” McKinney said. “There is interest in the sector as a whole … because of the bright lights economically across the country, tax reform, reg relief. Those things come into play from an investor perspective in connection with an IPO.”

Esquire, with $480 million in assets, was familiar with the view that banks of its size may be too small to go public, Sagliocca said. Investors, however, seemed more concerned about the company’s business model and performance metrics.

Esquire’s stock price has increased by more than 25% since its June IPO.

“The proof is we have been successful,” Sagliocca said. “Based on the stock price, there’s interest I would assume.”

M&A is another factor. Aspiring acquirers can benefit from having a stock to offer a target.

“Banks need a currency to do deals,” Tom Michaud, president and CEO of Keefe, Bruyette & Woods, said during a recent panel discussion at the University of Mississippi. “Cash can’t compete with a bank that can offer stock trading at 2.5x tangible book.”

While there is an expectation that IPO activity can remain steady next year, some constraints exist. The number of banks is down 7% from the end of 2015, providing fewer candidates for public offerings. At the same time, there are only so many management teams that have want to go public and have a constructive use for extra capital.

Earnings stories could also be challenged for executive teams that relied heavily on cost cutting to boost the bottom line, Hui said. Some institutions, which have run into concentration limits in areas such as commercial real estate, could face challenges as they try to diversify their portfolios.

Investors could also turn bearish based on a domestic or international shock, noted James Cassel, chairman and co founder of investment bank Cassel Salpeter. “There’s no reason next year shouldn’t be good for bank IPOs — but with an asterisk,” he said.

“My view in general is that time is never your friend with an IPO because so many things are outside of your control,” Cassel added. “If you want to raise capital in the third quarter of next year, you might want to have your head examined as to why not now.”

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Prepare your middle-market business now for future storms

By James S. Cassel

In light of the devastation following the recent hurricanes, it is important to evaluate what happened in Puerto Rico, Texas and even Miami, and consider how our middle-market businesses would have fared if a major hurricane, like Irma or Harvey, had been a direct hit on South Florida.

We fortunately dodged a bullet this time, and the damage to South Florida was nothing compared to what it would have been if we had taken a direct hit. Without a doubt, companies must have the right emergency contingency plans in place to protect businesses and people before, during, and after a storm. With proper planning, we can minimize the damage to our business operations and best protect our property and our relationships with customers, employees and community. We need to be able to expedite the return to normal operations.

So, how can we achieve this? Planning. While the appropriate steps may vary depending on your industry and the type of company you own, in general these best practices can be helpful:

Review your insurance policies now, before an impending storm. Get an expert to assist you so you truly understand your coverage. When a storm approaches, it is generally too late to make changes.

Have a written contingency plan and a preparedness checklist to put in place five days in advance of the storm. The Internet is full of many good resources like this one, and I recommend combining ideas from several resources and creating a customized checklist for your company. Additionally, it is important to identify appropriate protocols for protecting and securing your valuables, including everything from documents to property. Assign specific roles and responsibilities and train employees to execute the plan.

As the storm approaches, refresh your recollection of your insurance policies. Keep printed copies safely stored as well as digital copies.

Negotiate upfront with key suppliers to ensure that you have an appropriate system for receiving key materials and with fair pricing in place. You can ensure better outcomes and lower pricing by negotiating ahead of time, well before hurricane season. Also, make arrangements for alternate sites for storing products or running operations in the event that yours becomes unusable.

Ensure that you have adequate technology to communicate with the necessary team members and clients. Cellular phones might not work. Consider satellite phones.

Identify key team members to help ensure your company has adequate power generation (i.e. a generator) and key employees have access to power in order to keep the business running during outages. Have a secondary location(s) outside the market where you can move key people to continue operations.

Develop a post-storm plan, including assigned tasks, and train your employees to follow it. The plan should first assess the condition of your work force. Conduct practice drills — well in advance, and not just days before the storm. Make sure you do this regularly so that any new employees are properly trained.

Arrange for you and your key employees to have enough fuel, food and cash on hand. You would be surprised how many people fail to properly prepare for storms and are caught without basic necessities for a period of days. ATMs may not work.

While we cannot say for certain when it will happen, there is no doubt that, at some point, South Florida will get hit by a “big one.” Although it can be time- consuming to plan for future storms, it is a fact that when a major one strikes, the right planning can have a big impact on our businesses. Those who plan will protect their best interests and potentially gain an advantage over any competitors who, instead, opt to focus on their day-to-day business operations.


James Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle- market companies. He may be reached via email at or via LinkedIn at

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Recruit, train and mentor to create a diverse workforce

By James S. Cassel

Without a doubt, companies need a diverse workforce to reflect the population that defines the United States and makes us strong. As discussed in my last column, while most middle-market business owners recognize the importance of a diverse workforce, many still struggle to find the right strategy for recruiting and retaining the right team members. This month’s column will provide practical guidance for creating a diverse workforce and the culturally sensitive atmosphere necessary to retain it.

Why is diversity so important? Diversity brings together people of varied talents, skills, experiences, and perspectives, significantly expanding a team’s capabilities and fostering innovation by increasing access to new ideas. Representing a variety of nationalities and ethnic backgrounds can also make companies more relatable to a broader customer and client base and enable them to work in new global markets. A diverse client or customer base requires a diverse workforce. Workforce diversity also has proved to enhance employee and client satisfaction, leading to greater retention.

So how can you create a diverse workforce? While you should always hire the best candidates for job openings and internships based on their qualifications, here is some helpful guidance to keep in mind:

Recruitment: Expand your recruitment and think outside the box. Contact ethnic clubs on college campuses to find good candidates. Develop a strategy for speaking at events and positioning your company in front of a diverse audience. Practice what you preach. An ethnically diverse recruiting force helps you attract more candidates. When using headhunters, indicate that you seek qualified candidates with language and cultural diversity, and do not assume that someone bilingual speaks English and Spanish. Years ago, a former employer in Miami assumed my wife spoke Spanish when my wife said she was bilingual, and was surprised to learn she was referring at the time to Russian.

Training and education: Knowing it might not be possible to hire the strongest candidates with the right experience and skills off the street, you should develop strong training and education programs. Hire younger employees with potential and train and empower them to grow into the desired roles. Do not only look for talent in the big-name universities. Community colleges are a great place to look for talented candidates. Some of Miami’s most prominent business and community leaders graduated from Miami Dade College, for instance.

Mentoring: Mentoring is key to helping cultivate diverse talent. A great strategy is to pair up people. However, mentoring should not only be delegated to your staff — it should extend to you as the owner as well as other senior management. Make sure to personally invest time in mentoring and meet routinely with your employees. This is critical if you seek to cultivate a mentoring-driven corporate culture and instill mentoring in your company’s DNA.

Compensation: Pay people equally and give them the same opportunities for advancement.

HR practices: Advertise job openings broadly, and take advantage of word-of- mouth and referrals from employees, clients and community partners, as well as various websites like and Make sure your human resources department is properly trained and has the right policies — and perspective — to ensure your diverse employees have the support and working environment they need for success. Because all people are created equal, all people should have equal opportunity. Provide diversity-focused events to elevate everyone’s understanding of other cultures as well as an open forum for folks to communicate and build better relationships with those of different backgrounds.

All of this takes a conscientious effort on your company’s part and starts at the top. Considering our country’s labor challenges and uncertainties surrounding its immigration policies, it is not likely to get any easier to establish a diverse workforce. But we should never, ever give up. The future of our middle market and our country depends on it.

James Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle- market companies. He may be reached via email at or via LinkedIn at

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