A Tribute to Dr. Shannon P. Pratt
Anecdotes from James R. Hitcher of Moments Spent with Dr. Shannon P. Pratt, a Pioneer in the Business Valuation Industry
This discourse shares the author’s long, rewarding relationship with Dr. Shannon P. Pratt, an icon in business valuation (BV). He lived and breathed BV. Outside of his career, he had an intense love of life and liked to have fun. The author, James R. Hitchner, shares what he learned from Dr. Shannon P. Pratt, both in BV and life in general. The article contains some anecdotes of the many times he and Dr. Pratt spent together.
This discourse shares my long, rewarding relationship with Dr. Shannon P. Pratt, an icon in business valuation (BV). He lived and breathed BV. Outside of his career, he had an intense love of life and liked to have fun. I learned many things from him, both in BV and life in general. I hope you enjoy some anecdotes of the many times he and I shared.
Shannon was a pioneer in BV, who helped tame the wild, wild west of BV in the 70s and 80s. He was instrumental in turning a job into a profession, the valuation profession that we all enjoy today. His first edition of Valuing a Business came out in 1981 and was an instant hit. When I first got a copy, I read it cover to cover in two days. His book is obviously very successful, as the sixth edition will be published by the American Society of Appraisers (ASA) in early 2022.
I have never forgotten the ASA’s BV conference in San Francisco in 1996 where I was a presenter. While debating a technical matter with three or four people in a hallway, Shannon overheard us. He simply walked up to us and said, “Hitchner is right.” He said nothing more. I was humbled (and elated) that he said so, but I also saw that the debate was over, for everybody. Shannon had spoken—we listened and learned. Over the subsequent decades, he and I enjoyed debating technical issues. Note: I have intentionally omitted the times he said, “Hitchner is wrong.”
In 2000 or so, Shannon and I taught a three-day course in Atlanta. The first day he showed up and proceeded to arrange a bookstore in the classroom with books he authored. At first, I was taken aback, then amused. He was a fearless marketer.
In 2007, I presented “Hardball with Hitchner” at the AICPA BV conference. Shannon was one of the panelists. At his request, I called on him first, which I respectively agreed to do. He then narrated a four-minute joke involving urine and a hospital. Being that this was the first Hardball session I had ever presented, I was mortified. Well, he got a good laugh, and we were on our way.
Over time, Shannon and I presented together on many occasions, but this one stands out for me.
I will never forget a phone call that I answered in 2011 when Shannon asked me to join Jay Fishman and himself as coauthors to the annually updated PPC’s Guide to Business Valuations. Of course, I said yes and was honored that he and Jay would ask me to participate. What the three of us found out was that we agreed on about 90 percent of the issues. I am no longer with that book, and Shannon’s participation ended a couple of years ago, but it was an immense pleasure to work with him and Jay on it for about eight years.
That favorable relationship led us to write the book Hitchner, Pratt, and Fishman, A Consensus View, Q&A Guide to Financial Valuation, which was published in 2016. Of the 157 questions and answers, we only disagreed on two of the Q&As. It was an enjoyable experience.
Shannon also joined the group of coauthors on the book Financial Valuation, Applications and Models, 3rd (2011) and 4th (2017) editions. While Shannon was known as a first-rate writer, he was also a fantastic reviewer. Both editions benefitted from his keen eye.
In 2012, we were opposing witnesses at an arbitration hearing in Charleston, South Carolina. About 15 people were crammed into a small conference room during the hearing. The lawyers for both sides were amazed that we obviously knew each other, as we were talking before things got started. One lawyer asked, “Are you two guys friends?” “Yes,” we said, and each added something like, “Except his position in this valuation is wrong.” Everyone smiled, and then we got into it.
While many are familiar with Shannon’s considerable technical and teaching skills, many people might not know how much he loved life and its adventures. That really impressed me. I was fortunate to have Shannon as a friend and to share in some of those adventures, which I will talk about here.
- In 2000, Shannon and I attended a conference in the Dominican Republic as speakers. My 13-year-old son, Jason, came along. One evening, Shannon and his wife, Millie, joined us for dinner and showed genuine interest in hearing what Jason had to say. The attention he and Millie gave to my son was kind and considerate and made a distinct impression on me.
- At a meeting in New York City in 2004 in which we both participated, seats to a Broadway play were arranged for a group of us. In freezing, snowy weather, Shannon and I tried without success to find a cab. After 20 minutes we gave up on the cab and I hailed a pedicab, a bicycle attached to a cart that transports two people. The guy peddling could have not weighed more than 140 pounds. Together, Shannon and I weighed significantly more than that. We could not stop laughing at the absurdity. We just made the curtain call at the theatre. We gave the pedicab driver a very big tip.
- In a 2006 meeting in Jackson Hole, Wyoming, Shannon walked into the meeting wearing a t-shirt that said, “Mornings are no damn good.” Never one to be stuffy or pretentious, how can you not love a guy with such a good sense of humor?
- In a 2008 meeting in Hawaii, my wife, Karen, and I joined Shannon and Millie on a helicopter tour. At the tiny airport, we climbed into the pocket-sized aircraft. Shannon asked for assistance getting into the helicopter, telling me to push him into the craft. I gave him a shove on his rear to push him in. It wasn’t dignified, but he got seated. It was a wonderful ride.
- At a meeting in London in 2012, by which point Shannon was traveling in his familiar scooter, he asked me to tour the city with him on a double decker bus. I boarded, selecting a seat on the lower deck. Meanwhile, Shannon drove his scooter on the bus, parked it, looked at me and said, “Let’s go upstairs,” pointing to the narrow spiral staircase to the top deck. I was shocked by what he said and more so when he started to climb the stairs as the bus started moving.
- Nothing stopped Shannon when he put his mind to it, whether in business or his personal life. He was a dynamo until the very end.
Shannon, I will miss you.
James R. Hitchner
Jim Hitchner, CPA, ABV, CFF, ASA, is managing director of Financial Valuation Advisors www.finvaluation.com and is president of The Financial Consulting Group www.gofcg.org. He is also CEO of Valuation Products and Services (VPS) www.valuationproducts.com.
Mr. Hitchner is editor/coauthor of the books the Hitchner Pratt Fishman Consensus View Q&A Guide to Financial Valuation and the VPS DLOM Guide and Toolkit, published by VPS. He is also editor/coauthor of Financial Valuation Applications and Models (FVAM), fourth edition; Financial Valuation Workbook (FVW), fourth edition; and Valuation for Financial Reporting: Fair Value, Business Combinations, Intangible Assets, Goodwill, and Impairment Analysis, third edition, all published by Wiley. FVAM and FVW have been adopted by the AICPA for its five-day Business Valuation School. These two books are also used by the National Association of Certified Valuators and Analysts (NACVA) for its three-day Advanced Business Valuation course. NACVA also uses the Discount for Lack of Marketability Guide and Toolkit as part of this course.
He has spent over 41 years in valuation services, including as a shareholder with Phillips Hitchner Group, partner-in-charge of valuation services for the Southern Region of Coopers & Lybrand (currently PricewaterhouseCoopers), and senior appraiser with American Appraisal Associates. In the valuation area he has coauthored over 20 courses, taught over 60 courses, published over 150 articles, and has made over 350 conference and webinar presentations.
He is also an inductee in the AICPA Business Valuation Hall of Fame and a two-time recipient of the AICPA’s Business Valuation Volunteer of the Year award. He was also one of the four original members of the AICPA Business Valuation Standards Writing Task Force and served for the entire six years, up to the June 2007 official release of the standards.
