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Sell a Business Insights
Protect your Trade Name and Protect your Business Value
March 28, 2018 / in Business Valuation, Exit Planning, Sell a Business / by Adam Wiskind
From my experience as an M&A Broker, I can tell you that your company’s trade name will be a valuable asset to most prospective buyers of your business. Your trade name, which identifies your company’s brand and distinguishes its reputation with customers and suppliers, is worth strengthening and protecting if you plan to sell your company some day. It may surprise you that the name of your business, even if it’s not officially registered, receives some …
Don’t Let Key Employees Hijack Your Exit Strategy
February 14, 2018 / in Exit Planning, Sell a Business / by Jim Leonhard
In building a successful company, owners usually invest in hiring and developing managers and key contributors that become vital to the company’s effective operations. These people are considered “key employees”. When the time comes for the owner to exit his or her business, these key employees are usually valuable “assets” in the eyes of potential buyers. Unfortunately, if a business owner has failed to take certain steps, key employees can derail a successful sale or …
Is Your Company an Employee Stock Ownership Plan (ESOP) Candidate?
February 10, 2018 / in Exit Planning, Sell a Business / by Al Statz
Employee Stock Ownership Plans (ESOPs) have compelling competitive, financial and legacy benefits. For business owners weighing their exit options, a leveraged ESOP may be feasible if the owner, company and employees possess certain attributes: Owner Attributes Owns 30% or more of corporate stock Has a low basis in the stock Looking to reduce involvement in the company long term (5+ years) or shorter term if successor(s) are in place to take over Concerned with employee welfare …
Current Market Multiples for Main Street Business Sales
December 6, 2017 / in Acquire a Business, News, Sell a Business / by Louis Cionci
Each quarter, The International Business Brokers Association (IBBA) and M&A Source together with Pepperdine Private Capital Markets Project and the Graziadio School of Business and Management at Pepperdine University publish a quarterly national survey of business brokers and M&A advisors called the Market Pulse Survey. Price multiples and other key metrics in the Main Street Market section of the Q3 2017 survey are presented below. Main Street businesses are defined as those with enterprise values …
Help! I Need a Broker to Sell My Company
November 15, 2017 / in Sell a Business / by Exit Strategies
I was recently talking with a business owner who is considering selling his California company. He had found my contact information online, and while he was interested in getting started, he really didn’t know how to evaluate a business broker’s credentials for a sale engagement. Sellers are often unsure what questions to ask. For this reason, I like to spend 15 minutes to share my relevant M&A experience, my career history, our firm’s processes and …
When is the Right Time to Sell My Business?
October 11, 2017 / in Exit Planning, Sell a Business / by Al Statz
BOOK REVIEW — I don’t recall the last time I recommended a book, but today I feel compelled to tell business owners about an excellent new book titled, “When is the Right Time to Sell My Business?” This book not only helps you decide when to sell your business, but will also help you understand its value from the perspective of willing buyers, increase its value and marketability, and choose and plan your best exit …
Forbes Article: Which Is Better, A Financial Buyer Or A Strategic Buyer?
October 4, 2017 / in Exit Planning, Sell a Business / by Al Statz
I thought would share this brief Forbes article that came across my transom early this morning. I generally agree with author John Warrillow’s comments on Strategic versus Financial buyers. If your goal is to maximize value and liquidity today, and you’re not looking for an equity partner to help you build longer term enterprise value, a strategic buyer generally produces the best outcome. Having multiple strategic buyers at the negotiating table as a result of …
Is Private Equity the Right Solution for Your Exit?
September 13, 2017 / in Exit Planning, Sell a Business / by Al Statz
Is Private Equity the Right Solution for Your Exit? Private Equity Groups (PEGs) are disciplined buyers of lower middle-market companies. Most have cash funds and lender relationships in place for the right acquisition opportunities. PEGs often recapitalize a company, where they purchase a majority or minority interest. They bring growth capital and business acumen to unleash the company’s full potential. A recapitalization gives the owner substantial liquidity now, and a second hopefully larger bite of …
Targeting Strategic Buyers for Your Company
August 30, 2017 / in Sell a Business / by Exit Strategies
One aspect that separates M&A advisors from business brokers is the approach used to identify and target buyer candidates. The typical business brokerage approach is largely advertising based. They place a description of the seller’s business on several websites (BizBuySell and others) and then simply await inquiries. Business listing websites are effective for “main street” businesses (restaurants and auto repair shops) where the buyers are individuals and ad-hoc partnerships. However, in the lower-middle market, specialized corporate …
Six Reasons NOT to Skim
August 9, 2017 / in Business Strategy, Exit Planning, Sell a Business / by Don Ross
Pulling unreported cash receipts out of a business is indefensible and unwise under any circumstances, but particularly if the owner expects to exit in the next 3-5 years. All of us during our childhood were offered the parental edict: “Don’t do it, you are only hurting yourself.” So “why”, you may ask . . . now that you are a grown adult, “should I not skim?” Many reasons immediately come to mind and I am certain …