A group of closely held construction and pipe-manufacturing companies came to us in trouble. The company was aging, the next generation had just taken over, and the accounting function needed a rebuild from the ground up.
Cash management was a constant fight, cost accounting barely existed, and state-mandated environmental cleanup costs were piling on top of it all. The problem was that nobody could tell, in time to act, whether any of it was making money.
This is a common story in closely held businesses. The company grew up on relationships and hustle, and the finance function never grew up with it.
We sat in the seat and operated. We did not hand over a report and leave.
First, we cleared the backlog. We hired and trained the AR and AP staff and got processing current, then built cash flow projections tied directly to collections and project costs, so leadership could finally see cash coming and going before it happened. We stood up a monthly financial packet, a real budget, and a reforecast process, and we found and hired a strong controller to own it going forward. Then we tightened FP&A around the things that actually drive a project business: cost estimation, percentage-of-completion billing, and change-order tracking.
Clean books changed what the business could do. With financials a lender could trust, the company secured a line of credit, which took the constant pressure off cash. We shortened the cash conversion cycle and used lead-time schedules to capture savings on raw materials. And because the accounting was finally sound, the division integrated cleanly into a more advanced sister company without dragging the rest of the organization down.
None of this was exotic. It was an operator stepping into a closely held business, fixing what the numbers weren’t telling anyone, and leaving behind a finance function that could carry the company forward.
Why It Moved Enterprise Value
The income-statement gains were real, but the bigger result was what they did to value. Durable margins and clean, predictable cash make a business look less risky, and less risk is what raises the price a buyer or a lender will pay. The owner doesn’t just get a better quarter. They get a more valuable company, the kind someone can underwrite with confidence.
The result came from one thing: facing the value drivers honestly, and putting an operator in the chair to move them. Most closely held businesses have a version of this hiding in them.
If your business is growing but you suspect the value underneath it isn’t keeping pace, that’s the right time to look. We’ve sat in your seat, and we’re glad to help you find what the numbers aren’t telling you yet.
