The Sale Process

The Sale Process

The business sale process has a number of distinct stages and typically takes 6 to 10 months to complete.

The Business Sale Process

Finding the Right Buyer

Finding the Right Buyer

There are strategic and financial buyers. The best buyer is the one that benefits the most from the purchase.

Finding the Right Buyer

Valuation

Valuation

A business's value is determined by market comparables as well as business specific analysis.

Valuation

Ideal time to sell your business

The Ideal Time to Sell Your Business

The ideal time to sell your business is when there are positive trends in revenue and earnings with the expectation of more to come.  Growth is very influential in attaining a strong valuation multiple and, while valuation is technically determined by future prospects, historical performance is the most common way to get comfort with those prospects.…

business sale checklist

Where to Start: Here is a Checklist

Here is a high-level business sale checklist in the form of key questions to ask yourself to help you determine and communicate your objectives to a buyer. Ownership Do you want to sell 100% or would you be willing to retain a minority stake? Do you feel you could work with a partner? If retaining…

Private Equity - a second bite of the apple

A Second Bite at the Apple [the Ideal Private Equity Scenario]

Many owner-entrepreneurs are cautious about exploring the benefits and opportunities Private Equity (“PE”) can bring to a growing business. To summarize some general characteristics. PE investments are typically: –       Control positions ranging from 51% to 100% equity –       Held for five to seven years –       Part of a strategy to grow a strong competitive position in…

Strategic Buyer

What Will a Strategic Buyer Pay?

What will a strategic buyer pay?  Ideally a premium, but what defines a premium? By definition, it is higher than the average price.  But if the market will ultimately determine the price, where do you start? Start With the Notional Value A notional value determination is one in absence of an open market transaction, in…

risk management

Manage Operating Risk To Drive Value

Running a business requires taking risk.  Mitigating risk creates value.  Here we outline how to manage operating risk to drive value.  If your revenues are project oriented with little opportunity for repeat business, or you operate in an industry with low barriers to entry, or a people dependent business such as consulting, advertising or staffing, then what can…

Comparable Company Analysis

Valuation – Comparable Company Analysis

There are a number of approaches to valuing a business. There are market based approaches such as public company trading multiples and comparable transaction analyses and cashflow and earnings based methodologies such as the Discounted Cashflow (DCF) analysis. In this post we will review market based approaches.  Let’s start with the easier one to explain;…

asset

Top Five Impediments to Securing Exceptional Value

What are the main impediments to securing exceptional value for small private companies?  Many owner-entrepreneurs develop expectations for their business’ value based on news items and industry chatter about M&A and financing activity.  However, the small percentage of transactions that make the headlines are not reflective of the average transaction.  The factors we see most…