MO: Today we are with David Moser who is with Adams Capital Incorporated. Hi, David, and welcome and thank you for agreeing to do our podcast.
DM: Hi, Marlene. How are you?
MO: I’m fine, thanks, I’m fine. Alright, tell us a little about Adams Capital.
DM: We are an independent business evaluation firm which means all we do is business evaluation. We don’t do accounting, we don’t do legal work, we don’t do tax work, we don’t do investment banking. We deal with every kind of situation that our clients have that requires a business evaluation. Those kind of come in three different categories. The first is really what we call estate and gift planning when some owner of a company is looking to donate some of his interest to charity or someone dies owning a business interest. I say business interest in the sense that that can be anywhere from 100% to 5% of the stock. The second area is really a business transaction itself, when someone is buying or selling a company. There are a lot of accounting and tax reasons why they need to know what the pieces and parts are worth, as well as what the total is, without getting into the specifics of the accounting rules that drive that. Third is sort of, in a way, what happens when people disagree, or when companies disagree, when someone gets sued. Many times lawsuits develop anywhere from a disgruntled employee who says he was cheated out of some interest in the company he had, he was entitled to when he left, or was asked to leave. On the other end of the spectrum, large companies have litigation cases all the time that involve some fairly significant sized transactions. Firmwide, we just completed one in which the client had about a billion dollar tax issue with the IRS.
MO: That’s a significant tax issue.
DM: We helped the tax advisor in that case as well as the company resolve evaluation issues that had to do with whatever the subject was.
MO: What I find so interesting is that when you first talked about business evaluation, I just thought for selling a business, but it’s obviously for many other reasons. Some very important other reasons.
MO: What do you specifically do with Adams Capital?
DM: My role is really, in the Knoxville and Tennessee market, to continue the relationships that I’ve had with a lot of people from my past roles here. I’ve been in Knoxville for over 17 years now, 14 of which were with a predecessor company in which I built an evaluation group. What I do essentially is to make contacts and receive contacts from people who need evaluation done, so in that sense, it’s developing business opportunities. Once we have a project, I’m typically going to be involved in the gathering of information so we can write an engagement letter, work with our people in Atlanta. By the way, there are 13 professionals backing me, which I enjoy thoroughly because I’ve been able to shift gears a little bit from what I did before that involved a lot of the hands-on supervising in the practice to working with clients who have an issue and helping them figure out what that is, developing the project, tracking the project’s progress and then of course making sure they’re happy when we’re complete.
MO: And your main office is in Atlanta.
DM: Yes, and there are 13 people located there and I make up the other half of the company with myself.
MO: Here in Knoxville! We’re glad you’re here. How did you get started doing this?
DM: I went to school in Milwaukee and got a degree in civil engineering and somehow I never wanted to sit behind a drawing table, so I interviewed with a large firm called American Appraisal, which, all it does is evaluation projects of every size and shape around the world. So, my first 16 years in the business, I traveled a lot. I got a call one day as I was looking for other challenges, from Arthur Anderson, Atlanta. Two weeks later I was working there helping them build an evaluation practice. Four years later I was working at Ernst & Young down the street doing the same thing.
MO: You moved from Wisconsin to Atlanta. Whoo! That’s a big move.
DM: Yeah! Fast-forward through some other little side steps, a few years of independent work, and then we got tired of the hustle bustle of Atlanta and wanted some place that had a little bit more quality of life, if you will and have been in Knoxville for 17 years and never looked back. Two-and-a-half, well three years ago, some of the issues involving the independents that we didn’t have with my prior firm, which was an accounting firm, kind of got in our way. I started looking for alternatives and started talking to my good friend David Adams who is based in Atlanta, I’ve known him for 20 years. We came up with an arrangement that essentially would start an office in Knoxville and with my experience in the profession would basically continue developing projects here that someone in Atlanta wouldn’t necessarily even know about.
MO: Is there a favorite part of what you do? In everything that you do, is it meeting the people or is it actually doing some of the behind-the-scenes evaluation work?
DM: Well, my role now, as opposed to what it was when I was leading a practice or business, is really more developmental at the front end, then I kind of monitor the projects as they’re moving along and make sure the client is providing us the information our people need and then when it’s finished I’ll help deliver the final product. Our typical project is going to involve a 70 to 120 page report and a formal opinion.
MO: Wow! How long? Is there a typical time length for…
DM: We commit that once we have received everything we need to start that we’re going to turn the project around in 30 days. That’s unheard of in our business, because it typically takes three, four or five months. In reality the whole process is more like two to three months. Some clients are quicker than others in providing the data. When we flip the switch, so to speak, and we can start, it’s usually four to five weeks, generally.
MO: That’s pretty quick. I’m really surprised at that.
DM: I want to mention one other little thing that actually kind of evolved from some of the smaller, considerably smaller, opportunities that I was seeing as we started this practice, and that was that a lot of businesses, perhaps accountants who had referred other projects to us, or attorneys, or even independent people who were clients of an accounting firm said, “I’d like to know what I’m worth because somebody is trying to buy me, but I’m nowhere near big enough to afford a large project.” So, we do some significantly smaller work that essentially is called evaluation consulting, in which the fees are far less, but those are restricted reports that aren’t intended to be used for IRS purposes or litigation. They’re much less time consuming and they can solve somebody’s project or somebody’s need. Those are favors, so to speak, but there are a lot of people who would like to know what they’re worth from a professional and appreciate that kind of thing. We do those sort of here and there as they develop, but my primary focus is certainly on developing the projects that make sense for Adams Capital. Those are going to be the three to five million dollar revenue and up businesses.
MO: Do you go beyond this geographic area? Any place in the US?
DM: Yes. We’re generally working with people who are based here or who we know, that are maybe a division manager or somebody that’s been tasked with having something valued. There’s no particular, rigid line around the area. I’ve been as far as Tri-Cities, Kingston, Chattanooga, and Nashville depending on where the contacts lead me. Firmwide we do work all over the world. This year we’ve had three different projects in China alone. We had two in Mexico, one in Venezuela. The thrust of our work is really on serving clients that we can develop long-term working relationships with. They tend to be, for instance, we’re proud of the fact that we have ten billionaire net-worth clients. We have another hundred that are worth a hundred million and up. These are people that over the 16 years of the firm’s history, some of whom I’ve introduced, most of which my friend David has developed over the time that he’s had this business, done work for.
MO: Wow! That is impressive.
DM: We do god work. We do kind of premium, and yet we’re certainly in terms of price and fee, we’re in an area where professional evaluation firms would charge. What makes us a little bit different is the fact that we can turn the project pretty quickly and we have a rather incredible, this is something I’m pretty proud of, quality system in which everything gets checked at least three times by senior professionals before it gets released.
MO: Let me ask you this, how did you find Knoxville Executive Suites?
DM: Well, I was trying to remember this morning exactly how we met six, seven, eight, nine years ago, maybe? There was some business issue that we talked about.
MO: An attorney that I use had suggested that I call you.
DM: OK. That’s right.
MO: And then our paths never crossed again. And then you were wanting something temporary, I think like two weeks, because you were going to be permanently in another location downtown.
DM: Yeah, I had sort of in mind that the logical location for the Adams Capital Knoxville office would be where the firm I was with had been for a long time in the Riverview Tower building downtown and yet I found that in the first few months of being here temporarily, many of the people, attorneys and accountants that I contacted, wanted to come out and meet. The accounting firms generally have offices in this area as opposed to downtown. All the big firms are located out here and that’s really my primary focus now that I left an accounting firm, was to work with other accounting firms.
MO: Yes, I remember it was going to be two weeks, and then it was two more weeks and then… So, all of a sudden, how long have you been here?
DM: Since September of 2010.
MO: Three years now. Anything in particular that you find the most beneficial of the services of what we do? Other than that we’ll work with you short-term, long-term or whatever?
DM: Sure, sure. Well, for the first six months I guess, I probably used more of the things that were available because we were developing within Adams Capital, kind of an internal system that now has me. My phone system is VOIP, voice-over-internet based system that is internet driven.
MO: Yeah, we allow our tenants to do that.
DM: I had the KES phone system until about six months ago or eight months ago when we changed over firmwide. What I find most beneficial is I occasionally will need help in sending a package, receiving a package. I don’t necessarily need clerical support or administrative support other than some of the basic things like mailing or whatever. And I was going to say that, more importantly, the environment of friendly people, courteous people, in a professional office.
MO: Well, thank you.
DM: And certainly the other 80 or so folks in this building represent. I’ve done several different projects for tenants of this building. Some of which were not very big, others were pretty nice.
MO: Oh, that’s great! Before we wind it up, before we close for the day or say goodbye for the day, how do people reach you? How could customers, potential clients reach you, David Moser, at Adams Capital?
DM: Well, the office phone number is 865-470-4064 and my email address is firstname.lastname@example.org. Or, if you can’t remember any of those, simply look up adamscapital.com on the internet and my name pops up pretty quickly when you’re looking at professionals within the firm. You can click on my name and you’ll be connected directly to me.
MO: This was very interesting. I learned a lot. I’ve known you for three years, but I did learn a lot more about your company. Thank you so much, David.
DM: You’re welcome. It’s been a pleasure.
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Out: Thank you to our guest today from our Knoxville Executive Suites community for sharing with us their inspirational story. We look forward to bringing you another guest next month. Until our next visit, this is Marlene O’Hanlon with Knoxville Executive Suites.