by Kelly Deis of SoundPoint Consulting
- a Fortune 500 company in business for 35 years with revenues locked in for the next 5 years
- a start-up with an untested management team, dubious business plan and volatile revenue stream
by Kelly Deis of SoundPoint Consulting
by Kelly Deis of SoundPoint Consulting
Retiring from your own business isn’t as simple as calling HR and telling them you are ready to go. How exactly does one leave their own business for the good life? Here are a few options.
You started your business 10, 20 or even 30 years ago. It has been good to you. You’ve built it from infancy, fed it, grew it and, in turn it has provided you a comfortable lifestyle.
But, you’re done, or you want to be done. You are ready for the good life that retirement promises. But there is only one catch – there is no playbook for retiring from your own business.
As a business owner, there are several options available to exit your business. Here are a few…
by Kelly Deis of SoundPoint Consulting
by Kelly Deis of SoundPoint Consulting
Most business owners do not have a realistic idea of what their businesses are worth. Owners almost always think that their business is worth quite a bit more than the market would likely bear. There are several reasons for this.
1. Emotional Ties: Owners are personally and psychologically tied to their business.This is particularly true for long-running family businesses.
An owner has poured their heart and soul into their business. Where others may see a mundane business, owners – like proud parents, see their business as an apple of their eye. This emotional tie may cause a disconnect with the realities of the market. Continue reading
by Kelly Deis of SoundPoint Consulting
So, you want to sell your business. For most of us, it is a once in a lifetime event. There is no reason to expect that you should know the intricacies of a transaction.
That is why it is oh so important to have good advisers help walk you through the process.
One of the fundamental decisions you will need to make is whether the transaction will be an asset or stock sale. It will depend upon your individual circumstances as well as your business structure. Continue reading
by Kelly Deis of SoundPoint Consulting
The value gap is the difference in price between what the seller thinks his/her business should sell for and what a buyer is willing to pay for it. Bluntly, it is unrealistic expectations on the part of the seller.
Sadly, it is one of the bigger reasons why deals go awry in the lower-to-mid market tier. And, it can be avoided.
by Kelly Deis of SoundPoint Consulting
Owners want to sell their businesses for for a variety of reasons – some want to retire and others are ready to move on to something else. Most owners ask – “is now a good time to sell?” Not surprisingly, the answer is, “it depends”.
Here are three factors to consider when timing the sale of your business. Of course, it is best when all three are optimally aligned, but that is not always possible.
The owner is critical to the success and ultimate value of a business. Typically, once the owner is beyond his or her prime, the business value will begin to falter.
It is best to sell when the owner is engaged, still excited about the business and perhaps wiling to stay on after the sale. Likewise, the more youthful and healthy the owner the less they will appear eager to sell.
You want to be the owner that wants to sell, not one that has to sell. Continue reading
by Kelly Deis of SoundPoint Consulting
You started your business 10, 20 or even 30 years ago. It has been good to you. You’ve built it from infancy, fed it, grew it and, in turn it has provided you a comfortable lifestyle.
But, you’re done, or you want to be done. You are ready for the good life that retirement promises. But there is only one catch – there is no playbook for retiring from your own business. Continue reading
by Kelly Deis of SoundPoint Consulting
Most business owners focus on increasing profit margins as the only means of improving the value of their business. Profitability is absolutely important, but it is not the only factor to consider.
In fact, there are three components which can increase – or decrease, the value of a business: risk, profitability and growth. Continue reading
by Kelly Deis of SoundPoint Consulting
So, you want to sell your business. For most of us, it is a once in a lifetime event. There is no reason to expect that you should know the intricacies of a transaction.
That is why it is oh so important to have good advisers help walk you through the process.
One of the fundamental decisions you will need to make is whether the transaction will be an asset or stock sale. It will depend upon your individual circumstances as well as your business structure.
If you are an LLC, then a stock sale is not an option as there is no stock to sell (although owners may sell their membership interests).
S-Corps have the option of the 338 election which treats the transaction as a stock sale for legal purposes and an asset sale for tax purposes, but that is WAY beyond the scope of this newsletter. Continue reading