The biggest barriers to business sale bliss are low or declining profit and revenue source concentration. After all, it's steady and dependable profit that drives value. Add consistent growth and buyers will line up at your door. But many slam-dunk deals are derailed by latent...
Don’t expect business buyers to appreciate the work that went Into building your business. Buyers look at your business simply as an investment. They won’t appreciate the blood, sweat and tears you put into building it. You’ll always have the pride of knowing what you...
What is the one absolute, undisputed key to selling a business for maximum value? Multiple, high-quality buyers, worked simultaneously. Could it be anything else? Nope. Everyone instinctively knows this. Still, many try to find another way. Attempt to ply an alternative route to an optimal sale. There...
I’m convinced most business owners think high-value business sales just kind of happen. You run into a guy on a plane, or the phone rings one day and a sweet deal takes place. This misconception takes root from the sound bites heard at the club,...
A business has a lot of moving parts – customers, products, location(s), vendors, employees, reputation, relationships, processes, competitors, legal status and history, tax status and history, systems, databases, websites, etc. If one wants to peer into the crystal ball of a business and see its...
Selling a business is a sales process. The business sale price ultimately received for a business is greatly impacted by HOW the business is sold. A maximized business sale price is garnered through appropriate preparation of the offering documents (packaging); savvy execution of the proven...
You heard Joe Schmidt got an 8x multiple? Wow! I don’t blame you for holding out for 8. Your company is so much better than Joe’s. In fact, here are the normalized income statement and balance sheet for both your company and Joe’s. Of course,...
An offer for purchase says almost nothing about the value of a business. Why? Because “value” (as in market value) is the price a buyer is willing AND ABLE to pay. An offer, by its very nature, cannot speak to ABILITY to pay. I see...
How can I maximum the sale price of your business? HOW any asset is sold impacts the price for which it sells. Here’s how that applies to a business sale. ...
Should you tell your employees you are planning to sell? Should you tell key employees. When to tell your employees you plan to sell. ...
If one wishes to sell a business quietly, professionally and for absolute maximum, is an M&A advisor needed? If so, why? What does an M&A advisor do that might add value?...
To maximize the business sale price or value, be open to seller financing. If you ask for 100 percent cash at closing, you’ll receive a lower price. This is because the amount of cash the buyer has, and the amount a bank will lend, are...
No business owner-seller should pay up-front for services before they are delivered. At least not a large, lump sum up-front fee. The scam M&A advisory firms have for years coached $15,000 to $50,000 up front out of business owners. Unfortunately, nothing happens after that. Don’t...
Smart business sellers choose Acquisition Advisors because they want to sell their business quietly, professionally, and for absolute maximum....
You want to sell your business? Are you sure? Here’s the economic tradeoff you will be making. ...
Recapitalization refers to the restructuring of the balance sheet of the business. Particularly, the capitalization of a business, i.e. the debt and equity. Typically, it involved borrowing debt and paying the proceeds out to the equity holders. It could also involve a buyout of equity...
Five business purchase offers quietly presented to you at the same time, each tailored to your specific needs and desires, from the most fitting and capable buyers for your business, and a closing within 120 days of LOI or we’ll return any and all fees...
Your M&A advisor or business broker should do some basic things for you. Preparation of the business. Packaging. Buyer candidate outreach. Buyer screening, etc. Watch the video to learn more....
What is a management buyout and how is it accomplished? We can help. This video is a top level overview of the management buyout process. ...
What can you do today to sell your business for maximum value tomorrow? We tell you. Build in business drivers. ...
Question 1: What did you learn in Econ 101? Answer 1: Price is determined by the balance of supply and demand. Question 2: Why do some business sellers work with just one buyer at a time? Answer 2: Great question!...
There is just one absolute, undisputed key to selling a business for maximum value. Everyone knows it, deep down, and accepts it as fact. Still, many try to find another way, attempt to ply an alternative route to an optimal sale. There isn't one, at...
Quiet Is a PART of the Plan, Not THE Plan. Confidentiality is important, but if you make it your #1 consideration, you’ll never get anywhere. Here’s how to maintain confidentiality AND get your deal done....
There are three types of business buyers – individual, industry and private equity. As a business owner that will one day sell, you need to know which type is most likely for you. Going after the right type of buyer can make all the difference...
There’s a point in each sell-side engagement – towards the end – when one of the serious buyer candidates makes a push to communicate directly with my seller client. I call it the “moment of truth.” I talk to my seller clients about it in...
There is no possible way in the world to get the best deal by courting and negotiating with just a single buyer. Need I say again? You will not get the highest and best price if you deal with just one buyer....
You own a C-corporation that you want to sell. You asked us not to beat you up for never switching to a pass-through entity and just help you reduce taxes. Okay, here you go: Sell Stock. This is much easier said than...
Among the many issues to consider when selling ownership in your business is whom you sell to. Sell to an unsophisticated buyer with limited net worth and you’re asking for trouble. He or she might be able to rescind the transaction on legal grounds because...
If your company’s earnings have not suffered greatly during the recession, now might be the very best of all times to execute a management buyout. Buyers are out in mass and paying premiums for companies that have performed well during the recession. We did not see...
The biggest barriers to business sale bliss are low or declining profit and revenue source concentration. After all, it’s steady and dependable profit that drives value. Add consistent growth and buyers will line up at your door. But many a slam-dunk deal is derailed by...
Business owners find their motivation in varied things. Commercialize a pioneering methodology. Be one’s own boss. Prove naysayers wrong. Provide a great place for people to work. While every entrepreneur has his or her unique set of goals, virtually all share one in common -- to...
We’ve been reporting that premiums are now being paid for businesses that have managed to post decent earnings during the recession. One key reason is there are many more buyers than sellers right now. Lots of buyers fighting to win the few deals available means...
Cash is king, but owning a business can have some pretty nice perquisites. So what does a business owner do when he or she really wants to take serious chips off the table but does not want to give up ownership or management?...
Need to buy out a shareholder but don’t want to put up your own money? Need to take some chips off the table but don’t want to sell out? Reduce your risk and gain some experienced, well-capitalized and well-connected partners? Consider leveraged recapitalization....
For owners of large and midsize companies, need for liquidity does not have to be an all-or-nothing decision. It really isn’t like the famous song by The Clash: “Should I stay or should I go now? If I go it could be...
Selling a business is a sales process. The business sale price ultimately received for a business is greatly impacted by HOW the business is sold. Maximum business sale price is garnered through appropriate preparation of the offering documents (packaging); savvy execution of the proven “quiet...
When your mission is to sell a business for absolute maximum sale price, selling a business is a sales process. The business sale price ultimately received is greatly impacted by HOW the business is sold. That is, when the mission is to sell a business,...
Thousands of sources of equity capital in the U.S. and around the world are willing and able to pay top dollar for great companies, leave the tenured management in place, provide meaningful ownership to the manager or management team that remains, and mentor and support...
Acquisition Advisors talks about win-win transactions. That is, business purchase/sale transactions that result in a “win” for the owner-seller, buyer, employees and community. By “community,” we mean where the company operates. When the right buyer is found, the business has its greatest opportunity to thrive. This,...
Most successful business owners are good people. Caring people. I’ve worked with thousands of them. Jerks tend to implode, eventually. Traits of care, honesty and integrity aid the business owner in surviving and succeeding over the long haul, so most who “make it” are “good folks,”...
The day will come when you want out. Given all your hard work and sacrifice, you deserve a big pay day. So, why not set yourself up today for that to happen? As it turns out, buyers have a lot in common. Below is a list...
How a business is sold has as much to do with the value received (i.e., Sale Value) as the characteristics of the business itself, but the business— and its compilation of characteristics— is the foundation. Remember the Sale Value© equation: Sale Value = Enterprise Value +...
Business owners hold something of value -- ownership in a business. And, in the life of an owner, there typically comes a time when he/she becomes willing to part with his ownership in exchange for some things he/she values. Typically, the thing of value is...
When a battle must be waged, a battle plan is developed. Experts are brought in and together settle on the plan that has the best chance of securing victory at the lowest possible risk and cost. The plan is always confidential, and almost always includes...
Transitioning a family business is a delicate, time consuming and potentially hazardous undertaking. There are numerous tax and non-tax factors to consider. Common complexities include how to handle family members who work in the business versus those who do not, and liquidity issues that inevitably...
When selling a one-of-a-kind asset, how do you estimate “fair price”? How do you know whether an offer is “high”? How do you determine what price is absolutely the highest sale price possible?...
There is but one absolute, undisputed key to selling a business for maximum value. Everyone knows it, deep down, and accepts it as fact. Still, many try to find another way, attempt to ply an alternative route to an optimal sale. There isn't one, at...
It’s a shame. Business owners just don’t understand that how a business is sold has as much to do with the eventual value obtained (“sale value”) as the characteristics of the business itself. They naively think their business has a certain value and all they...
Most business owners fail to understand that there is a way they can sell their businesses, when they decide the time is right for them, for the very highest price possible, and serve well the many people that have served them so well for so...
What value do you personally bring to your business? More precisely, what impact would your departure have on the performance of your business?...
Assuming ownership of a new business is one of those tough, scary-as-heck jobs. It's tough for the business buyer. It's also tough for the seller, employees, vendors, customers, et al. Nobody's comfortable with change. In a business purchase-sale transaction, if you don't burn the...
We all have heard that companies sell on "multiples of earnings." As such, the talk at the country club or trade conference has quickly moved to who sold for the highest multiple. We hear the multiples, but we almost never hear the definition of...
If you own a business organized as a C-corporation, you could face a wealth-draining dilemma when you try to sell. Buyers of businesses want to effect the purchase by buying all assets of the business as opposed to purchasing shares of stock from the person(s)...
You've devoted untold time, money and energy to building and running your business. It may well represent your life's work and net worth. Now you've decided that it is finally the right time to sell. Here are six things you should know....
Who wouldn't want to retire, sell the company and put money in the bank? Who wouldn't want to have the time and freedom to travel, play tennis, exercise and volunteer? Even spend more time with the grandkids?...
Q: What is the difference between audited and reviewed statements?...
Many private business owners dream of "going public." It's the ultimate entrepreneurial status symbol. Build a company and take it public. Well, you've really done something....
Do you remember the old saying "The person who represents himself has a fool for a client"? Athletes, highly paid executives and persons involved in legal disputes adhere to it. Unfortunately, some business owners do not. No doubt, you're an amazing person - but you...
Do you really need an attorney? Do you really need a CPA? Are they worth the money and could you do without them. Well, the answer is probably yes, you could do without them, but you'd be worse off for it. So,...
In an attempt to project what the future might hold for a business, the buyer looks at many things. One is past performance of the business. Historical income statements provide useful, factual information about income, expense and resulting profit for particular periods of time. Given...
You fought and clawed your way into business ownership. Then, several times, you did it again just to survive. The years rushed by. The kids are grown. A few of your retired friends have asked, quite crudely, "You gonna die in the saddle?"...
There are more than 10,000 ESOPs in the U.S., covering 8 million employees. Read about the benefits and drawback to an ESOP....
The ESOP offers powerful and compelling benefits - but it's not for every person or every company. It adds an ongoing layer of cost and usually involves the use of leverage, so good candidates will have healthy profits and cash flow. It also often requires...
Heck no. You don't have to retire. Strom Thurmond remained a U.S. Senator through the age of 100. Dwight Hauff is 103 and owns Hauff Sporting Goods in Sioux City, Iowa. Jack Weil is 106 and still owns Rockmount, a Denver-based manufacturer of Western shirts....
There exists a tax reduction technique called "Stock-buying Middleman." We have previously cautioned against the transaction but have since learned that this type of transaction is "listed" by the IRS. To quote from IRS Notice 2001-16...
M&A Advisors typically represent owners of businesses valued in excess of $2 million. These businesses may be multi-unit retail establishments, dealers and franchisors, but are more often manufacturers, distributors or service businesses with regional, national or international clientele....
Want to know the value of your business? Pose the question to your closest friends and advisors. First, write your answer down. You will be amazed at the range of responses. Go one step further and ask each person how their answer was determined....
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From the Business Seller's Perspective Setting: A Business Seller's leverage is greatest prior to signing a Letter of Intent ( LOI) because the Buyer is at an informational disadvantage - as the Buyer gains information in the due diligence process it will gain momentum in the...