How to exit, with Sherbet Founder Asher Moses

Once you’ve secured investment and used it to build and scale a profitable business, the time might be right to exit. However, when is the right time to sell? 

In this episode, I speak with Asher Moses, founder & CEO of Sherbet London, the capital’s leading electric taxi company. A serial entrepreneur, Asher grew his original small fleet of London taxis into one of London’s leading transport companies. Through Sherbet, Asher is future-proofing the iconic London Black Taxi for future generations. 

Having sold his commercial advertising company, Taxi Media, to US company VeriFone, Asher shares his advice on what to consider before exiting a venture and when he feels it’s right to consider selling up.

If you’d like to contact Asher you can reach him via asher@sherbetlondon.com

Asher’s advice:

• A good exit is all about timing since you obviously want a high multiple return
• Operating companies are very different to tech companies in terms of multiples
• Hopefully you will have created a brand to out-compete others in your sphere
• Exiting from your company gives you financial freedom and the space to re-think
• It also gives you credibility when you start your next venture
• It gives you the time to make improvements and move with the times
• If you receive an offer, it’s probably wise to accept it as they don’t occur frequently 
• Make yourself part of a growth plan in the company (it’s you they’re buying)
• A CEO can always stay on, to give advice and support - not necessarily for very long
• You will inevitably find it hard to step back and phase out
• You must be hard-headed about the valuation
• Be very precise responding to the questions
• Know who to sell to

FF&M enables you to own your own PR. Recorded, edited & published by Juliet Fallowfield, 2023 MD & Founder of PR & Communications consultancy for startups Fallow, Field & Mason.  Email us at hello@fallowfieldmason.com or DM us on instagram @fallowfieldmason. 

Let us know how your start up journey is going or if you have any questions you would like us to discuss in future episodes. 

FF&M recommends: 

• LastPass the password-keeping site that syncs between devices.
• Google Workspace is brilliant for small businesses
• Buzzsprout podcast 'how to' & hosting directory
• Canva has proved invaluable for creating all the social media assets and audio bites.

MUSIC CREDIT Funk Game Loop by Kevin MacLeod.  Link &  Licence

Transcript

How To Start Up S9 Asher 'How To Exit' 

Asher: [00:00:00] you've got to really understand that it's all about timing. It's trying to build a business to exit with a high EBITDA to get a high multiple return on your business. [00:01:00] Thanks, Asha, for your time today. It's great to have you on How to Start Up, it would be wonderful if you could give us a brief introduction as to who you are and a bit about the businesses that you've started.

Sure, I'm a licensed London cab driver. I did the knowledge and became a licensed London taxi driver. And London was a very opulent city in those days. And taxis were the main form of transport for the white collar and blue collar workers. Um, and I've always innovated within taxis. I started my own fleet of taxis and...

Rented the taxis to drivers. I introduced advertising because advertising was restricted in central London. Um, so advertising, um, would target an ABC one audience in central London and I innovated many, many different projects for licensed London taxis until I exited from [00:02:00] taxi media. 

Juliet: When Did you buy and when did you sell?

Asher: I bought it in 2009 and sold it in 2011 just before the Olympic period 

Juliet: That's a quick exit? Do you think that's a quick buy and sell? Is that normal?

 Not really. I innovated and introduced a product like, you know, credit cards wasn't in taxis at the time. So I had a company called Taxi Link, which allowed taxi drivers to take credit cards. And the company that bought my media company was a strategic buy because they were a credit card and wanted to come into. So, So, , we made it accessible for them. Um, uh,

Juliet: just to recap, how many companies have you bought and sold to date

Asher: I've bought about four companies and sold about four companies.

Juliet: Amazing. In this episode, we'd love to learn more about. When's the right time to exit a business? How to exit a business? Any advice that you give to founders who are starting and scaling a business on exiting? I'd love to ask you, [00:03:00] what do you think are the biggest mistakes founders make when considering exiting a business?

Asher: I think, you know, you've got to really understand that it's all about timing. It's trying to build a business to exit with a high EBITDA to get a high multiple return on your business. It's also important to think about how you position your business, because if you're an operating company, you get X kind of multiple, on your EBITDA, if you're a tech company, you would then get a different type of multiple in the tens rather than the single digits.

And today, traditional businesses are struggling between, hey, we're traditional, but we need tech and data. So how do we become a tech and data company if you're an operations company? Um, and that's what we've been struggling with and we're working through to finding solutions to to try and find a balance between tech companies and operational because every technology company needs a good operator.[00:04:00] 

Juliet: Yes, exactly. And I think it's good for listeners to know that as much as you bought and sold taxi media in 2011, you're now founder of Sherbert. So 

would you like to tell us a little bit about Sherbert?

Asher: So Sherbert is interesting. So when, when I sold to taxi media, it was nice to have an exit. When I sold to Verifone, it was absolutely brilliant to have an exit. It was a great feeling as an entrepreneur 

after all those years to go into an ATM and see that. exit. I then realized at the same time, Addison Lee sold out for 300 million pounds.

And I said, well, if he can do it, I certainly can do it. Um, and I came back and realized that we live in a brand awareness world where people don't call taxis anymore. They call brands with values. And this is where we created a brand with a great marketeer, um, who helped us create a brand that can compete and out compete with Um, all the brands that are coming in to the taxi transport world [00:05:00] and we created sherbert Sherbert is cockney rhyming slang for sherbert dab, which is cab Right 

Juliet: I 

get it.

Makes perfect sense.

Asher: and it relates to the taxi drivers.

Now, today, people have a choice to book a low cost app like an Uber or a premium app like a Sherbet. And that's what we've created. We're differentiating ourselves to be the best in clean, green transport and using technology and data to build our business and innovate.

Juliet: Given you've had successful exits in the past, what does it mean to you having exited a business? Because I feel like 

I'm three and a half years into my business. And someone said, what are you trying to do with it? You're going to sell it. He is a lifestyle company. I was like, I've just started. I haven't got that far yet, but I know a lot of people go in with a very strong plan and idea of what they want to do with it, but for you now having left that business behind you, what does it mean?[00:06:00] 

What did it give you when you sold other than financial?

Asher: financial freedom is absolutely great because it clears your head and gives you a clean slate to rethink, re strategize, and do what you really do well. Because by the time you've exited, you've realized you've exited because you've done something really well. Now you need to build on that and then think about the bits that were missing.

In the first exit that you can make it better like now for me. I ran a fleet of taxis and exited and sold it. I introduced advertising and introduced it and sold it. Today, Sherbert we're future proofing licensed London taxis and we're future proofing it with technology and data. So you've got a traditional business with multiple revenue streams.

You can ride in a Sherbert, drivers can rent a Sherbert. Advertisers can advertise on the sherbet and all of this is thinking, what can I do better? And[00:07:00]  the, the, the, the technology part is telematics. We brought in longitude, latitude, time, date, location. That allows accident data. When you bring in pollution sensors, you can pick up pollution data.

So suddenly you become part of the city needs. For example, today you need smart taxis for smart cities. 

So our taxis are really smart and can help smart cities 

Juliet: so for you, it was, it was really building, growing and selling when it was right for that business and then taking your learnings was there ever a question that you wouldn't just stop working and just go, right, I've done that? I feel like I've discovered this theme quite a lot with people I know who are self employed that you're tenacious and ambitious and very forward thinking.

You can't just sit still. So when you sell, it's very likely, that you're going to just go off and do something else. Um, but for you, did it give you validation or a sense of [00:08:00] satisfaction? I mean, or was it scary when you suddenly had no business to run?

Or were you already onto the next?

Asher: Yeah, you're already on to the next. The minute you got a bite. If you're an entrepreneur, you know, if you've done it once, you certainly want to do it again. You want to do it bigger. It's not about the money. It's about you've suddenly built confidence. Um, you've gained credibility. Um, it's a big word exit.

It's a credible word and you, you need to be able to aim for your next one, which would be at least double the size he did the first one, but it's not easy. It's a dream.

Juliet: What is it with entrepreneurs that want to just double down on the pressure and the stress and the angst? But , it's addictive, isn't it?

Asher: It's addictive, but we want to 

solve the problems. 

We know all the problems. 

Juliet: you want to find new ones

Asher: Yeah.

Juliet: What should founders consider before making that decision to exit? Are there some key things that they should really sit down and think about before going after an exit?

Asher: First of all, if you've got an opportunity to exit my, my [00:09:00] words, I'll take it right. You know, don't be worrying about too much what I could get what I may get because they don't come along very often. The offers if it's in front of you aim for goal. and take the word exit. Um, and then rebuild yourself.

Now, try and be part of the growth of the exit. So maybe there's a way where you can be part, um, you sell a majority or a minority, depends, but be part of a bigger plan try and be part of a growth plan. Okay, with them because you can contribute if you're the one who's exiting. You've obviously got some skill to contribute to your new proprietors or owners plan.

Juliet: But how does that work? Cause for me, the biggest joy of being self employed is that I have freedom and autonomy to be nimble, to make decisions and recruit people that I love and work with clients that I admire. If I'm selling the business and I'm still part of it, have I not just given myself another boss that I might not like that much?

Hmm.

Asher: most of the time it's for a very short period. They buy a business [00:10:00] with you. Most people buy the entrepreneur rather than the business. So they do want your skills. They like the profit line and the numbers and the turnovers and the clients, but it's really you. That they're buying, in my view, and if you can help deliver their goal, because you're going to be there for a couple of years, so try and deliver their goal, and at the same time, you're building your future dreams, your future goals, because your mind is clear from financial worry, because entrepreneurs financial worry can hit very critical points.

Juliet: Hmm. Yeah. And in terms of that sort of. Mental load, I suppose, of going from being the boss to having people to answer to you. Are there any pieces of advice you'd like to offer someone of how to manage that?

Asher: Yeah, um, I've learned really well, um, because coming from, um, driving a taxi without spreadsheets, without education to get into boardrooms and to try and understand CRMs and [00:11:00] tech, et cetera. Um, so yeah, it, the first time we, uh, I entered into corporate, it was absolutely the most challenging thing of my life.

I never had a boss in my life. Um, but I did make him coffee and I said, I'll do it once. Um, but the point was, um, I found it very difficult, but learn from the corporates if you can learn, because my business today is heading towards a corporate with all the skills that I said, nah, I'll never do, is implemented into my current business for scale and growth. Learn from it, don't fight it.

Juliet: So it's almost like, it's not a partnership in the actual definition of the word, but from a mental stimulation perspective, you ideally would want to exit with someone that you would learn from, through your exit years that you can take on to your next business.

Asher: Sure, sure, it'll be nice if that's part of the journey, yeah.

Juliet: Would, would you be able to say top three benefits and drawbacks to a founder retaining a minority stake in their company?

Asher: The benefits is [00:12:00] you're selling a majority stake so you should get some financial peace.  but You would lose control of your vision, okay? It's very hard to keep control and I think that's a big problem because if it's your baby, first of all, businesses shouldn't be a baby.

We need to separate it and we must take the emotion out  

Juliet: someone said to me, Oh, you're self employed. It's like, no, no, I'm employed. It's just by a business that I happen to have started. And I found when someone said that to me, it was really interesting because it gave me peace of mind that I'm part of a team and we're all in it together and we work for this company and it feels like the company is bigger than me, which is very comforting in a weird way.

So yes, that separation of it's not you. But then going back to the fact that they are buying the founder, that's a tricky one, isn't it? Because how much of you do you allow them to have?

Asher: So that's very important pre selling your businesses to ensure your business. Can run not only with an entrepreneur, it needs to be run and you need to have built a [00:13:00] team that's solid around you that you can literally run your business whilst you're away on holiday and that will give confidence to investors to say, wow, you've got a tremendous team.

I don't really need the entrepreneur. It'll be great to get his skills and vision. That's what I'm buying. But it's his team who are really going to help the new. Investors take the business forward.

Juliet: Especially, I suppose, with service based businesses, because you need that proof of longevity that it can run without you, especially if you're exiting.

 When you have a minority stake in the business that you have exited or exiting, what would be the sort of negative to that still being involved other than control of the vision?

Asher: It's very disheartening seeing a vision, uh, being diluted and not being achieved. Because an entrepreneur, I have sniper vision. Right. I'm in the hairline. I don't want nothing around it. I'm not interested and I don't want new ideas. I want to get to go right.

That's an [00:14:00] entrepreneur's vision. Get to the goal. Um, and get to the goal by core business and not dilution popcorn ideas.

Now, over the last 18 months, I've learned a bit later in my life to stay laser focused on operations and profitability, you know, to me the two most important words I'm hitting 60 now, but the two most important words are pennies and time, right?

Don't spend your time and count your pennies right now To achieve your business goal, don't waste your time talking to the wrong people in hope, you know, so, and if you can do that 30 years at the age of 30 and not find out that the age of 60, those are the two most important factors.

Juliet: Oh goodness. Time is more precious, I feel, than revenue when you're in startup phase. And it's a limiting factor. The money will flow and it'll come and go and it could be exponentially exciting. But time, there are only 24 hours in the day and I have a real issue with that. I want more.

That's a [00:15:00] conversation for another day is how to find more time in your day.

Asher: But success comes with that time, you know, us entrepreneurs to succeed, you need to put 80 hours in the first year, 80 hours a week, the second year, 70 hours, the third year, 60 hours, the fourth year, 50 hours, and then you delegate and work on the business, not in the business. And that's the key factor. And you're ahead of your competition.

Juliet: Yeah. And I presume when you're looking at people buying you out, that bolsters the business and makes it a stronger option for them when you've built it in that way. And you're, you're exiting before you're exiting, I suppose, in terms of your commitment to it. God, that sounds great. Um, sleep. This is amazing.

Um, so can founders typically maintain a paid position like a CEO role while selling their shareholding? 

Asher: I have seen in many, many a time companies get bought out. The CEO stays with the company. There's a big difference between CEO and entrepreneur with a visionary. A CEO can operate the business. Um, um, but [00:16:00] you do get diluted when once you dilute your shares. You have to be prepared and it's a real emotional thing because we will carry that, you know, uh, even though we try and say, think with your head, not with your heart.

Um, in business, um, it does get emotional when you're on a journey, you've sold a lump, a lump of that business and it's being diluted. outside your hairline sniper vision into the periphery of that sniper scope. It's just, it's kind

of diluting your time from staying focused on core business.

Juliet: And I guess it's what you want out of it, isn't it? You've got to think long and hard of like, why am I doing this? And for me, starting business, why am I doing this? If I was going to exit, why would I be doing it? And what's it going to bring me in my bandwidth, my time, my attention?

And in my job satisfaction as well, it could be a point, it's like, there's a few friends that are selling their businesses saying, it's great. I get to go back to having a normal job. And I was like, hang on a minute, what does define normal? Um, but for them, it's that peace of mind of, I can put my phone in a drawer while I'm on holiday because somebody else is doing [00:17:00] that scary bit that I'm no longer responsible for.

Um, but being at peace with that and, and was it hard for you to step away 

because you're always going to 

Asher: yeah, no, yes, it's hard to step away, but if you've got somebody who's taken the majority share, you can give your advice. and give you love and give you a care and give you support. But if they don't want to take it because of, um, there's certain rules or regulations and you know, markets work differently. It's hard for a suit to talk to a cab driver. Alright, so it's important to try and find a fit It's the fit for a short time then you the two years that you have to be with your as a majority minority shelter Give your best, give your support, give your advice.

But if they're not doing it, you know, just to do your time and, and move on. Um, but it's a very difficult process to step back and phase out. It's not easy seeing this beautiful store and this vision. It's suddenly dilute into part of somebody else's vision, but you've been [00:18:00] paid for it. Smile and look forward to the next chapter of your journey.

It's part of the journey to win, to lose, to it's part of an entrepreneur's journey. And except all of it, it's not going to be all one way, it's 

consistently up and down. 

Juliet: every, every single guest, there's two pieces of consistent advice that every guest has given is get a good accountant and be okay with a rollercoaster. And I sort of laugh going, I'm not okay with a rollercoaster, but I accept it and I appreciate that that is very much part of this.

Freedom and autonomy that I've afforded myself in starting a business, but it doesn't mean I'm at peace with it all the time.  .

well, Actually looking at the offer, what would be some common mistakes founders might make when negotiating that exit?

Asher: I think most founders are emotional and look at unrealistic valuations. Right? You know, where we got emotional valuations. And we've got to realize that, the person looking at that valuation and your proposal that you think is the greatest idea, and [00:19:00] everybody thinks it's the greatest idea, person looking at that is looking at the numbers.

Binary. And if you set your plan to present it binary and cold, you're better off with them because you need to present it in a language that they understand. Right? And emotion is something, they're like passion, um, which is an emotion, but an emotional, um, about how brilliant your business is, the fluff doesn't work.

It's the numbers and the markets and the research and it's very cold place and they're not your friends. Um, and you need to think it that way, even though they're going to invest 10 million pounds in you, 100, they are not your friends, they are 

binary, and they're looking for profit.

Juliet: It's so interesting because in my day job in our business, we teach founders how to do their own PR and we say they are their own best storyteller. And that passion and understanding of their business needs to be articulated succinctly. [00:20:00] But the emotion part of it can help with that sell in around the brand or the business or why it exists.

But you need to back it up with the numbers. And I think a lot of founders that we've met have been fantastic skincare developers, but they are not across their numbers. And actually, when you are a small business or a startup, you are probably 80 percent in your sales role. And 10%, 20 percent in your finance role and very tiny percent is actually creating the skincare product potentially.

And I think a lot of people don't appreciate that. It's like, Oh, great. You're self employed. You've got unlimited annual leave and you can work anywhere in the world. And it's like, I need to be across my numbers. That's for me, for peace of mind. It's knowing our P and L at any given point. Um, because it's a business first and foremost, and without numbers, without revenue, without cashflow, there is no business.

And what is it? There's. 80 percent of new businesses fail it's not because the idea isn't good. It's because they don't have any cashflow. Um, so we've talked in other episodes previous about getting financial advice, having people help teach you how to [00:21:00] run your P& L, but you do need to take that responsibility for being across your numbers, especially when you're coming to exit.

And that's so interesting what you said about take the emotion out of it, because you'll have that emotional perception and value attributed to your business. That no one else will understand because it's your business, not theirs. And that doesn't have a value to them. So yeah, thank you for that.

Asher: a formula to value, they look at it through numbers, and there's formulas, x amount, x to x multiples, they exist. And you need to look at them and learn about exit before presenting. What does it mean to exit? What are those numbers? And how do the investors look at, look at you? How are they looking at you?

Don't think what you're giving them. Think you're the investor. What's, and it's all on YouTube, by the way, everything, everything you want to learn. Spend an hour at night in YouTube. You, You, you, 

Juliet: And in terms of timing, what gave you that, is it a gut feeling or was it looking at a spreadsheet feeling of now is the time to exit or was it because you were being approached? How do you know when it's the right time to [00:22:00] exit?

Asher: never know. I think you need to, you should say, look, wouldn't it be great if I could build a business that I could exit for X million of pounds in five years? I think that's the opening phrase of an entrepreneur. It doesn't matter what the business is. Because we all do different things, the opening words, what could I do to exit in five years and I want X amount of millions of pounds, right?

From there, I would look to look at my skills and build your skills to achieve your exit number. That's the way I built Sherbert. Put the number on the board, then built my skills. What did I do best? And now I'm aiming for, please God, a super exit with Sherbert one day. Um, So, um, yeah. So that that's the way I would focus on doing it.

Juliet: timing the other way around, once you've decided to go for it and you have an investor giving you an offer, do they put a time pressure and a deadline on you?

Asher: think you should try and work for an exclusivity period. They're very tiresome, cumbersome processes and the demands [00:23:00] are huge. I need this. I need that. I need this. Um, and each answer has got to be thought through meticulously. And we've got to look through the numbers that they before you can't just say here it is.

Think it through, think through the questions, only deliver the answers that relate to the questions with zero fluff, zero emotion, because they're not interested. It's about why is it happening, and it's happening because of this. What is this? And here's the answer. And 

don't 

Juliet: sounds exactly like talking to a journalist when they ask a question, just give them what they've asked for. That's all they need and be clear. Yeah.

Asher: No more, no more.

Juliet: Yeah,

Asher: Less is more.

Juliet: Always, always, um, apart from time in the day, more would be more. And is there any other golden nugget piece of advice that you'd like to offer a founder thinking about selling their business?

Asher: Well, Well, I think it's important to... You know, if you're thinking about selling your business, think about who you want to sell it to, because it's not like you've got a business that somebody is [00:24:00] wanting. Um, so you're thinking of selling a business, think about where's the audience. Who are they? Do they exist?

Have they bought a business before? Um, because if you can't see who you want to sell to, then you haven't got a journey. You need an end point. People, the investors will say to you, well, in five years time, we invest in you. Who are you going to sell your business to? You need to have that answer and you need to say, I will sell this business to, uh, this company, that company, because of they have bought this at this multiple.

So live your business, eat your business, be part of your business, thrive on it, live on it, live well from it. But you need to put the hours, um, and entrepreneurs, lonely hours. It looks great from the outside. They see you as an iceberg, you know, all great above water, but below water, they don't see the sleepless nights.

They don't see the bills and the PAYE and the rent. Um, so it looks good on the top.

Juliet: Well, it's like the swan analogy, isn't it? And when I worked at Chanel, it was very [00:25:00] much, Oh, it's that you're absolutely perfect on the surface and underneath you're peddling furiously to get everything done. 

Asher: Absolutely. 

Juliet: And I've made a real hash of my Instagram. Cause I work, I work remotely and I can travel with my work.

As long as I have internet, I'm fine. So slow travel for me is fantastic. I'll go and live somewhere for a couple of months and was like, Oh, you're always on holiday. I'm like. Are you joking? I've been on zoom at three o'clock in the morning. So the time difference, but I think Instagram can lie. So I need to stop posting basically, it's funny on the outside what people kind of assume of assume and.

A lot of people are like, Oh, you're doing so well. It's like, no one else sees the PNL. What does well look like to you? So I think for me, defining what success looks like has been really important. Um, but thank you, Asha. It's been so interesting chat to you and huge congratulations and everything that you've achieved.

Um, Um, I was I was going to say so far, cause I know there's more to come. So very exciting. And, um. I, I I see Sherbert everywhere in London and it, yeah, makes me smile.  and and I love the fact that you're protecting, protecting black taxis. Cause I heard a [00:26:00] few years ago when the Hackney taxi school shut down because of Uber and rideshare and everything like that, you're protecting our iconic London cab.

So thank you from 

Asher: We're future proofing it. We're future proofing it, and it's, uh, gonna be replicated around the world.

Juliet: Amazing. Oh, that's exciting. That's very exciting. you so much for your time. It's been lovely to meet you and thank you so much.

Asher: My pleasure. I wish you all luck. Good luck.

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