Sell-side Mergers and Acquisitions.
When… You don’t see how to grow the business anymore. You’re ready to diversify and take some chips off the table. The business value equals your goals and a big economic/political shift could decrease your valuation. You’re not sure how to reach the next level on your own. Your interest… Read More »How Do You Know When It is Time to Sell?
In the lower middle market, most sellers must finance a portion of the sale of their business. Expect to provide anywhere from 5% to 15% seller financing. This helps close a funding gap and demonstrates that you believe in the business as a going operation. Sellers who are confident in… Read More »Most Sellers Must Finance
Cue the scary Halloween music. When selling your business, you can expect to hit a couple of snags before the deal is complete. But proper planning can help you avoid the most common “deal killers” like these: Deal Killer 1: Time We have a saying in the M&A industry: “Time kills… Read More »Don’t Go in the Basement: Escaping M&A “Deal Killers”
Recapitalization (recap) is a partial sale of a company that allows the owner to liquidate some of the value they have in their business. Typically, this involves selling equity (usually 70-80%) to a third-party, however some business owners do sell just a minority stake. Recapitalizations are a standard investment tool… Read More »Recapitalization: Pros and Cons
With all the upheaval in the world right now, you’d expect M&A deal value to take a dip. But recent market analysis shows that’s anything but the case. According to GF Data, companies with an enterprise value of $10 million to $25 million sold at an average multiple of 5.9… Read More »Lopsided Market Drives M&A Values in Pandemic
The more your business revolves around you, the more risk buyers see. To increase business value, build a strong management team. Work yourself out of the day-to-day business by developing an experienced, empowered management team. The less the business is dependent on you and your knowledge or relationships, the less… Read More »Work Yourself Out of a Job
When it’s time to sell your business, you may have multiple buyers to choose from. You could receive offers from strategic, financial, and/or individual buyers. As you start thinking about selling your business, think about what’s most important to you in a sale. Different buyer groups typically operate by different… Read More »Pros & Cons of a Strategic Buyer
We’ve been talking to private equity groups around the country to keep a pulse on where the M&A market is at right now. The message we keep hearing is that these firms are “open for business.” Private equity firms are in the business of buying businesses. It’s how they deliver… Read More »Private Equity: “Open for Business”
It’s estimated that in the Lower Middle Market, only 20% to 30% of companies who want to sell will successfully transition to new owners. The number one reason for unsuccessful transitions is due to business owners who try to handle a sale themselves or use an advisor with limited experience and buyer reach. For most business owners, at least 80% of… Read More »Do-It-Yourselfers Lose 30%
SBA relief efforts incentivizes buyers to move ahead with business acquisitions. Per the SBA website, “the SBA will pay six months of principal, interest, and any associated fees that borrowers owe for all current … as well as new 7(a), 504, and microloans disbursed prior to September 27, 2020.” This… Read More »Motivated Buyers Fueled by SBA Incentives and Need