IAM248- Founder and Finance Professional Helps Companies with Business Valuation

Nataliya Kalava is a finance professional with approximately ten years of professional experience in financial services industry including: business valuation, public accounting, and financial planning and analysis (FP&A). Nataliya is the founder and owner of Araliya Valuation Consulting, AVC – a business valuation consulting firm. Nataliya performs valuation analyses for both individuals and corporate entities including for M&A, gift and estate tax planning purposes, financial reporting, transaction support and litigation. Prior to AVC, Nataliya worked at Equinix Inc., Humana Inc., BDO LLP, Sigma Valuation Consulting Inc. and PwC. Nataliya earned a Master of Science Degree in Finance from the University of Tampa and a Bachelor of Science in International Business and Management.

• CEO Hack: Emails to contact clients
• CEO Nugget: If you want to do something just go for it
• CEO Defined: Being able to execute

Website: https://www.araliyavaluation.com/

LinkedIn: https://www.linkedin.com/in/nataliyagrygoryeva/
Twitter: https://twitter.com/tampavaluation

Full Interview

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Transcription

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INTRO 0:02

Do you want to learn effective ways to build relationships, generate sales and grow your business from successful entrepreneurs, startups, and CEOs without listening to a long, long, long interview? If so, you've come to the right place. Gresham Harkless values your time and is ready to share with you precisely the information you're in search of. This is the I AM CEO Podcast.

Gresham Harkless 0:26

Hello, hello, hello. This is Gresh from the I Am CEO podcast and I have a very special guest on the show today. I have Nataliya Kalava of Araliya Valuation. Hopefully, I said that right. Nataliya, it's awesome to have you on the show.

Nataliya Kalava 0:38

Thank you for having me. It's a pleasure to be here.

Gresham Harkless 0:41

No problem. Super excited to have you on and what I wanted to do, which is read a little bit more about Nataliya so you can hear about all the awesome things that she's doing. Nataliya is a finance professional with approximately 10 years of professional experience in the financial services industry including business valuation, public accounting, and financial planning and analysis.

Nataliya is the founder and owner of Araliya Valuation Consulting, AVC, a business valuation consulting firm. Nataliya performs valuation analyses for both individuals and corporate entities including for M&A, gift and estate tax planning purposes, financial reporting, transaction support, and litigation. Prior to AVC, Nataliya worked at Equinix Inc., Humana Inc., BDO LLP, Sigma Valuation Consulting Inc., and PwC. Nataliya earned a Master of Science Degree in Finance from the University of Tampa and a Bachelor of Science in International Business and Management. Nataliya, are you ready to speak to the I AM CEO community?

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Nataliya Kalava 1:32

Yes, I'm excited. Let's get it started.

Gresham Harkless 1:35

Yeah, let's do it. So the first question I had was to hear a little bit more about what I call your CEO story. What led you to get started with your business?

Nataliya Kalava 1:41

Sure. So I actually always wanted to have my own business. Once I graduated with my master's in finance. I didn't know what to do or which step to take with little or no experience, I thought that the best thing would be to go into the industry, get a job, get some experience, decide, and learn a little bit more about myself, what would be the best next step. And that's exactly what I did. I started with PwC, started doing audits didn't love the job, was not the most exciting environment. Although I love the people, I thought the community and the people that work for PwC are just incredible.

I had a great time and I started building a very strong network of people and building those relationships which are so crucial when you are building a business. Kind of a side note, thereafter, I actually fell into doing valuation work. When I left PwC, I joined a small boutique firm, and we specialize mostly in gift and estate tax valuations. I was with them for a few years. Then I joined BDO LLP, which is the fifth largest public accounting firm. I was with them for a number of years and at that time, I was really starting to think what would be the next step. Now that I have a few years under my belt, what would be the most logical sequence of events I can create for myself to design my path to entrepreneurship? So nothing happened right away.

I moved back from New York to Florida and I worked for a couple of more companies, Humana Inc, and Equinix Inc. At that time, I was basically ready, I knew that I liked valuation, I enjoy finance, and playing with numbers. It combines the elements of creativity of art and science when you're valuing a company. So I decided that that's a natural step for me is to go into consulting and start my own firm. I got my certifications, I referred back to a lot of the relationships I built throughout the years, and I started my own company, kind of a long answer to your question.

Gresham Harkless 3:08

Great answer. I absolutely love it. Because you know, you have so much, you know, background and experience that you're tapping into. I think sometimes and I don't know if you're a big watcher of Shark Tank, but I always, see them sitting.

Nataliya Kalava 4:02

I love it.

Gresham Harkless 4:03

Yes. How do they figure out how to value the company? I know that there's a process behind it looks so quick that they do it right there but I imagine there's a lot involved in it.

Nataliya Kalava 4:11

There's a shortcut.

Gresham Harkless 4:12

Yes, yes.

Nataliya Kalava 4:14

The real valuation does not necessarily follow these same shortcuts and steps, but it does make you think in a way about how the investor potentially thinks about the company and what can we do to enhance that value. So there's a lot of useful information on Shark Tank. I love that show. But that's not necessarily the official or other step of procedures that a typical valuation analysis would entail.

Gresham Harkless 4:40

Yeah, I can imagine that and I think even I've heard like off camera they talked about not even you know, you see the 10-minute clip and even the actual negotiation everything is like hours and hours after that. So I know that's just a snapshot of probably you know what it is you do so could you guess break down a little bit more about what you do how clients are even supposed to understand how to evaluate their company and things like that?

Nataliya Kalava 5:01

Sure, so valuation appraises how much the company's worth, or what's an interest in the company's worth. So for example, if you own 50% of the company, or 10%, or 100%, all of those elements will have a different value. Also, one thing to keep in mind is that two plus two sometimes equals five and valuation. Numbers don't necessarily add up. So for example, if you own let's say, 10% of the company, and you are a minority owner, that does not have voting rights or rights to control and manage the company, your shares, or your portion of the ownership of that company will be less than if somebody has those prerogatives to control and create change in a company.

But to take a step back valuation of the company usually comes in three ways, and you can mix and match them. At the end of the day, you can either look at the cash flows or the income approach, how much cash flows the business generates, you can also look and compare how the company does in comparison to other similar companies within the same industry, which is a market approach and then the third one is, if it's a non-operating business, meaning they do not generate constantly, cash flows will look at their assets.

So for example, a real estate holding company or a securities holding company just has these assets, but they're not actively receiving cash flows on an ongoing basis. So valuation of any company would fall into utilizing one or more of those approaches, the more we can use, the more reliable our valuation would be. So any business owner can monitor their cash flows, look at the assets they have, and then also keep in mind and benchmark how are they doing in comparison to other companies within the same industry.

One other thing I would say to keep in mind, when we're filing tax returns, as business owners, we want to deduct a lot of expenses and reduce our tax liability. So we try to show less becomes more at the end of the day. Well, for valuation purposes, it's the other way around. If you take everything out, and you say, I have little to no cash flows left at the end of the day. Well, it shows that your company's less valuable, because if you have a prospective buyer, they want to see that there's cash flow left at the end of the day.

So this is something to keep in mind, as any business owner builds a strategy because once you form a business, even if you expect to operate it for 10 20 30 years, whatever the number might be one day, you have to keep in mind that exit strategy, are you going to sell it, transfer it, share it with your employees, whatever the case might be.

So you're always operated business with one eye on the exit. And to that extent, keep in mind those cash flows. If you have little to nothing left, it will reflect the value of your company at the end of the day.

Gresham Harkless 8:07

Now I wanted to ask you, you might have already touched on this, but I want to ask you for what I call your secret sauce. This is what you feel kind of distinguishes you and sets you apart, which could be for you or even your organization.

Nataliya Kalava 8:16

Sure. Great question. So I don't know if it's necessarily secret sauce but in my experience, especially with larger companies, everything is very transactional-based with valuation work. It's there are not a lot of recurring clients, or in some instances where it is required by the tax to be tax compliant. There is that recurring work potential, but a lot of the time a business owner just needs to know the value of their company because they're trying to sell it for example, in which case a business owner approaches evaluation professional, and they want to know what that value is. and once you provide that report, you never see them again.

So from my approach, I don't want to just give them the report and say, Here you go, here's 100 pages, enjoy the reading and hopefully you can understand that and what I've done after I received my payment. I tried to take it a step further. I tried to educate the business owner we go over the analysis, and I answer any questions that they may or may not have I offered to deal with the systems during a negotiation process if it's a transactional, transactional scenario for valuation so that educational component and really building that relationship and not treating it as a simple transaction that they came in, what are their report and laugh. I think that's what's at the core of my company and I implement that with all of my clients.

Gresham Harkless 9:42

Yeah, that makes perfect sense and that definitely ranges fruit even, and just you know, some of the information that you told us you just about valuation about understanding all those factors. That just goes a long way because a lot of times people want the report but the report is usually for some other means. So being able to have and tap into your expertise and understanding exactly, why they want to do other things that they can do and having that, eye that other eye towards, the exit strategy, as you mentioned as well, too is definitely huge.

Nataliya Kalava 10:07

Yeah, definitely.

Gresham Harkless 10:08

Awesome, awesome, awesome. So I wanted to switch gears a little bit and ask you for what I call a CEO hack this might be an app or book or a habit that you have but it's something that makes you more effective and efficient.

Nataliya Kalava 10:18

So mine is actually very simple, I would say it's emails, I approach a lot of my prospective clients and start establishing relationships that I do not have in a professional world through emails. Everyone is really busy. Everyone is preoccupied with their own businesses or personal lives.

So in my opinion, email is less intrusive. I try to research the person I'm trying to approach and get a good background about them, and then compose a well-thought-out email if they're interested to continue the conversation, or if they see a strategic possibility of working together, or if I can be of help to them, they reach out. So a lot of my communications and a lot of my outreach efforts start electronically, and then we'll follow up in person if that relationship develops that way.

Gresham Harkless 11:16

Awesome. That makes perfect sense and I love the fact that not only just an email, but an email that's kind of customized, you actually do the research and due diligence because a lot of times you get emails, and it seems like that same email was sent to literally every single person that a person knew, but they have that individuals. Exactly, exactly what I was talking about

Nataliya Kalava 11:33

You say hello, and then they give you a sales pitch.

Gresham Harkless 11:38

Exactly, exactly. But actually seeing and getting an email where somebody actually does research is definitely awesome and it's a way to break through the noise because few people are actually doing that. So I love that hack. Now I wanted to ask you for what I call a CEO nugget and this is a word of wisdom or a piece of advice. If you can happen to be a time machine what would you tell your younger business self?

Nataliya Kalava 11:55

I would say if somebody's considering doing a business, or they're not 100% satisfied with their current job, and even to my younger self, if you want to do something, just go for it, take that courageous steps, nobody has 100% everything right laid out, there's no real right or wrong, it is just learning along the way. So it's just taking that first step for me was crucial because there are always a million excuses twice, you should not do something they're always obligations, financial or otherwise. So just having the courage and saying to yourself, just go for it. Just do it and then you figure out along the way, what's the right path is important.

Gresham Harkless 12:36

Yeah, I think it's absolutely huge. I always say like progression, always getting better always taking steps forward. A lot of people have and they want to make everything so perfect that they never ever take that first step.

Nataliya Kalava 12:46

Yeah

Gresham Harkless 12:46

So it's important to kind of take it and understand that that's just like I always say it's 1.0. So there's 2.0, could you figure out what you want to do, what you want to scale back, however, you want to change it, and then you can always grow on that.

Nataliya Kalava 12:56

Absolutely. I 100% agree.

Gresham Harkless 12:59

Awesome, awesome, awesome. Now I wanted to ask you my absolute favorite question, which is the definition of what it means to be a CEO. We're hoping to have different “CEOs” on the show. So Nataliya, want to ask you what being CEO means to you.

Nataliya Kalava 13:10

I think is right in the word itself, the Chief Executive Officer, which the middle word, the executive is, the key to the definition is being able to execute, as you probably have heard from 1000 people, everyone has some type of ideas and opinions, the execution is everything. Unless you can actually follow through, develop a strategy and be courageous to follow through words themselves, or ideas themselves are just meaningless. So I think the definition of this CEO embodies the word's execution and being able to have that vision strategy and steps to take your company or to take you in your personal life because you can be CEO just for your own personal life, even if you're an employee to the next level.

Gresham Harkless 13:56

Absolutely. I would absolutely agree with that. It's funny you say that because it's all about execution. I hear a lot of people say, Oh, I had that idea when they see somebody else do it and it's the difference between them. The person who actually did it. It's all about execution. So I love you kind of reminding us of that.

Nataliya Kalava 14:11

Yeah, absolutely.

Gresham Harkless 14:12

No problem. Nataliya, I truly appreciate your time and all the expertise you provided today and loads of great value. I wanted to pass you the mic, so to speak, just to see if there's anything additional, you want to let our readers and listeners know and then of course, how best they can get a hold of you.

Nataliya Kalava 14:24

I think just my last point is not and you kind of brought up the same idea before don't be stuck trying to be perfect with all the details because that's probably not going to happen. I don't know if you're familiar with Tim Ferriss's work, but I'm a fan. He has this example which is great and I can iterate it for other people and they tell it to other people all the time “Don't be a donkey”. Make a decision. There's the background story is there's a donkey at the crossroad and there's a stack of hay and there's a bucket with water and the donkey doesn't know what to do.

So he starves and dies of dehydration. So the moral of the story is to pick one path or the other. You're not stuck with it forever. You can always change the course and improve and any action beats inaction every day.

Gresham Harkless 15:15

Absolutely, absolutely agree with that. I love that visual and I haven't heard that from Tim Ferriss, but I absolutely love that. So yeah, you can drink half of the water and then just realize you want hay and go back and get the other half of the hay but you can't do anything if you take no action. So great reminder again.

Nataliya Kalava 15:29

Just Don't be a donkey.

Gresham Harkless 15:30

Don't be a donkey. Well, thank you so much again, Nataliya, for people that want to get a hold of you what's the best way for them to do that?

Nataliya Kalava 15:36

Sure. If anyone needs to get a hold of me or would like to get in touch just email me at nataliya@araliyavaluation.com We are also on Twitter @Tampavaluation or LinkedIn @nataliyagrygoryeva.

Gresham Harkless 15:59

Awesome, awesome, awesome. We'll have those links in the show notes. And it doesn't matter where anybody's located, they can reach out to you is it only one area?

Nataliya Kalava 16:06

Anywhere, anywhere is fine. I have clients throughout the United States and internationally. So I like to make friends with everybody.

Gresham Harkless 16:14

It sounds good. I do too. I appreciate you for being our friend for a little bit. We'll have all those links in the show notes and I hope you have a phenomenal rest of the day.

Nataliya Kalava 16:21

Thank you, same to you. Thank you for having me.

Outro 16:23

Thank you for listening to the I AM CEO Podcast powered by Blue 16 Media. Tune in next time and visit us at iamceo.co I AM CEO is not just a phrase, it's a community. Be sure to follow us on social media and subscribe to our podcast on iTunes Google Play and everywhere you listen to podcasts, SUBSCRIBE, and leave us a five-star rating grab CEO gear at www.ceogear.co. This has been the I AM CEO Podcast with Gresham Harkless. Thank you for listening.

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