An Interview with Harris Hafeez, Managing Partner and Member of Advanced Physical Medicine & Rehabilitation
If you're an entrepreneur looking to make a big exit, Harris Hafeez is a guy you should listen to. He's been there, done that, and has a wealth of insights to share. Harris is the Managing Partner and Member of Advanced Physical Medicine & Rehabilitation (Advanced PMR), a company that offers outpatient physical therapy throughout central New Jersey. He joined the company in 2015 and has since seen the growth of the company from two clinics to seven clinics. In 2018, Harris and his team successfully exited the company through a private equity exit.
For Harris, the major impact of the exit was the access to capital and the ability to pick and choose where they wanted to expand. But, he admits that one downside was the time it took to get deals done.
"When you're dealing with larger corporations, there are many, many moving parts," he told me in a recent Zoom interview. "And a lot of those parts have to go through a diligence process."
As an entrepreneur, he has always strived to close as many deals as possible; however, he understands the necessity of doing quality deals over numerous ones.
His post-exit experience has taught him the importance of due diligence and understanding all aspects of a deal before moving forward.
"It shocked me that many deals that you think look great, at least on the surface, and you just peel one layer of the onion, and you find very quickly that there's a lot of things that you don't want to get involved in," he said.
Since exiting Advanced PMR, Harris has been a buyer of smaller entities, rolling them into his current entity. He has also opened up new offices in New York, where he saw opportunities.
As a seller, Harris has a wealth of advice for entrepreneurs who are looking to make an exit.
"My main piece of advice to anyone looking to partner with a PE firm is – if you're comfortable with who you want to work with on a day-to-day basis – [whether] the valuation makes sense," he said. "Don't try to fight for bigger numbers, and don't try holding things off for the next year or even the following year. Because you don't know what's going to happen."
Harris argues that to know a company's value; you must understand more than just the financials. He believes it is crucial to know the company culture, who works there and what services they offer.
"I want to talk to the people behind the screen that are in the weeds dealing with the consumers they are dealing with. The services that are being offered and learning more about what the company offers and the company culture as a whole," he said.
In a nutshell, Harris Hafeez's journey from entrepreneur to private equity pro is evidence that due diligence and understanding the company culture are key to a successful exit. He has learned that it's OK to take the time to do quality deals rather than numerous deals, and he encourages others to focus on more than just valuation and revenue when evaluating a potential exit.
What do you think? Do you share Harris' views? Share your thoughts with us!
