No experienced buyer purchases a company without knowing everything possible about it; this learning process is known as “due diligence.” Buyers like the process, and sellers do not. By viewing the opposing viewpoints on due diligence, you can understand why. Due Diligence – Buyer’s Viewpoint (1) The buyer assembles a team of experts including but not limited to an accountant,… Read More
Financing guaranteed by the Small Business Administration is widely misunderstood – and thereby underutilized – by business owners. In 2016 the SBA 7(a) program was authorized for $26.5 billion but only $24.5 billion was actually deployed. The definition of “Small Business” for these purposes includes companies with as many as 1,000 employees in many industries. We will focus here on… Read More
Sellers, in preparing their businesses for sale, want to make the business as attractive as possible to a buyer. Change of ownership is a particularly critical moment for the business and a buyer will be particularly sensitive to the possibility of losing key employees during the transition period. For a buyer, this will be a large perceived risk. Additional risk… Read More
Business owners often have a sense of gratitude towards their employees – they understand that they couldn’t have built their business without those employees and want to see them have the opportunity to run the business and enjoy the fruits of ownership. Over 50% of my clients express an initial desire to sell to employees if the key employee group… Read More
There are no Mulligans when selling your business. Avoiding these “sins” will give you a good shot at executing a successful transaction. (1) Not Understanding the Value of Your Business Business valuation is not an exact science, but it remains an essential first step. A good business valuation will help you understand what your business looks like from the perspective… Read More
Business owners looking to exit are often faced with the following dilemma: cashing out at a reasonable price is very important, but they don’t want their business swallowed up by a large industry player eliminating the identity of the business they have built. They are concerned that their employees are treated fairly as well. Business owners in this situation often… Read More
If you are the owner of a successful business, you are regularly bombarded with solicitations from brokers who claim to have a buyer just begging to pay you top dollar for your business. You are probably sensible enough to realize that these solicitors are not the best persons to sell your business. But who is? What we will call “Transaction… Read More
Let’s say you have an opportunity to purchase a closely-held business. Perhaps you are a key employee in a business and the owner is looking to get out. Or perhaps you want to leave the corporate world and purchase a franchise. If, for example, the purchase price is $2 million and you can get SBA (Small Business Administration) guaranteed financing… Read More
