Request a Call and we will get in touch with you
Exit Planning Insights
Which Business Valuation Will Facilitate Negotiation?
May 22, 2017 / in Business Valuation, Exit Planning / by Exit Strategies
You are getting ready to sell your business so you must ask yourself some questions: When do I want to exit? Who are the most likely buyers? Is my business adequately prepared to sell? How does it compare to other like businesses? And of course, what’s my business worth? All business valuation relies on some prediction of the future. Business appraisers apply a variety of adjustments to financial statements, theoretical constructs and historical data to …
Hidden Problems with the Price Formula in Your Buy-Sell Agreement, and Solutions
May 12, 2017 / in Business Valuation, Buy-Sell Agreements, Exit Planning / by Al Statz
It is tempting to select a formula approach to pricing shares when business partners come and go. After all, a formula is easy for everyone to understand, and in theory at least, inexpensive to apply. If you’re satisfied with getting to a price, any price, then congratulations – job done. But the goal is to arrive at a price that is fair to all concerned. This article discusses some of the unforeseen problems with buy-sell …
Make No Mistake: The IRS is Serious About Qualified Appraisals and Appraisers
May 3, 2017 / in Business Valuation, Exit Planning / by Al Statz
The IRS and the Tax Courts are serious about requiring taxpayers to properly determine the value of non-cash estate assets, gifts and charitable contributions. To avoid having the value of an inherited, gifted or donated privately-held business interest challenged or rejected by the IRS, obtain a qualified business appraisal (valuation) from a qualified business appraiser. The IRS defines a qualified appraisal as one that: is performed in accordance with generally accepted appraisal standards; meets the relevant requirements of …
Is 2017 a good year to sell my company?
April 26, 2017 / in Exit Planning, News, Sell a Business / by Roy Martinez
Sellers often ask us if it is a good time to sell their business. My response is usually, “yes, but it depends”. The optimum time to sell a particular business depends on many factors, and this article discusses some of them. First of all, timing depends on the company: How are its business fundamentals? Is it growing? Flat? Shrinking? Is it profitable? How is the quality of earnings? What is the outlook for the business …
Do investment bankers, M&A advisors and business brokers actually add value? If so, how?
March 30, 2017 / in Exit Planning, Sell a Business / by Al Statz
Financially savvy company owners, such as private equity groups and diversified public companies, clearly see the value that M&A advisors add, since virtually all of them hire one to run a professional sale process when selling a company in their portfolio — even when they know who the buyers are and which one is likely will pay the highest price. On the other hand, most entrepreneurs only sell their company once. As a first time …
Increase Business Value with Recurring Revenue
March 23, 2017 / in Exit Planning, Sell a Business / by Exit Strategies
Businesses with a higher percentage of recurring revenue generally sell for higher prices. Recurring revenue business models are highly sought after by strategic and private equity buyers because they are perceived as less risky. Future revenue is more predictable and requires less ongoing sales effort and reinvestment. Companies like Salesforce.com pioneered recurring revenue in the software world, creating the Software as a Service (or SaaS) model. SaaS turned the traditional software licensing model on its …
Case Study: How One Entrepreneur’s Advisors Enabled a Successful Estate Transfer
March 1, 2017 / in Business Valuation, Exit Planning / by Bob Altieri
I recently had a client who wanted to transfer his medical distribution company to his son and retire with peace of mind — a common occurrence these days. Dad and his CPA requested an opinion of Fair Market Value to set the price for a transfer of stock. After I appraised the company (S corp.) stock at $2.0 million, Dad and Son asked me how to finance the transaction. Dad was reluctant to carry a long-term loan for …
Twenty Reasons to Know the Value of Your Company
February 22, 2017 / in Business Valuation, Buy-Sell Agreements, Exit Planning / by Al Statz
Private company owners and shareholders seek independent business valuations at various times for various reasons. Here are twenty situations in which you may want to obtain a business valuation: An owner has passed away and a valuation is required to settle the estate per IRS regulations An owner is getting divorced and needs to have the company or their fractional interest valued to settle the marital estate An owner wants to gift shares to his …
Employ a Recurring Revenue Model to Increase the Value of Your Business
February 15, 2017 / in Exit Planning / by Adam Wiskind
Businesses with recurring revenue are generally more attractive and more valuable to buyers. Recurring revenue, simply stated, is the portion of a company’s revenue that is highly likely to continue in the future. An effective recurring revenue model creates a “stickier” relationship between the provider of a product or service and the consumer. Those businesses don’t have to spend as much time and money acquiring new customers. Effective recurring revenue business models: Consumable -The original recurring revenue …
Early-Stage Tech Company Exits
January 11, 2017 / in Exit Planning, Sell a Business / by Exit Strategies
You’ve built a world-class software solution, delivered to customers as a SaaS application or web service. You’ve recruited a team and created intellectual property. Customer retention is strong and the buzz is growing in your vertical market. Each new customer acquisition represents incremental recurring revenue that falls directly to your bottom line – and the company is closing in on cash flow positive territory. Could this be the right time to sell the company? You may be thinking, I’ve barely …
Exit Strategies Group, Inc. is a leading provider of business sales and acquisitions, business valuations, and exit planning services for family owned and closely-held companies since 2002.
DRE #01878920
Member of
