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Exit Planning Insights
Secrets to Business Valuation – a Lesson from Curly
January 8, 2020 / in Business Valuation, Exit Planning / by Al Statz
Remember that scene from the 1991 movie City Slickers where Curly (Jack Palance) shares the secret to life with Mitch (Billy Crystal) shortly before he dies? Curly holds up his index finger and says to Mitch that the secret to life is to figure out his one thing and then stay with it. Channeling Curly today, I will share with you the three things that determine the value of any operating company, with rare exception. …
Corporate Social Responsibility in Mergers and Acquisitions
January 2, 2020 / in Business Strategy, Exit Planning, Sell a Business / by Al Statz
Like it or not, and irrespective of our personal political ideologies, corporate social responsibility has gained in popularity in the past decade. In this article, we’ll discuss what Corporate Social Responsibility (CSR) is and what it means for private business owners from an exit strategy perspective. The Four Pillars of CSR CSR is often thought of as having four pillars: the community, the environment, the marketplace and the workplace. Community. This pillar refers to the …
Consider Your Options When Selling a Business with Real Estate
December 18, 2019 / in Exit Planning, Sell a Business / by Al Statz
We often get asked how owning a facility (versus leasing one) affects the sale of a company, so I dug through our 17 years of business sale transactions involving seller-owned real estate to look for patterns. And the archives didn’t disappoint. I found five common deal scenarios that shed light on this question. But first, here’s the short answer. Owning your real property is likely to increase the demand, transferability and selling price of your …
Why Business Owners Should Prepare to Sell Now
December 7, 2019 / in Exit Planning, Sell a Business / by Al Statz
Reason 1: Concentration of Wealth A typical business owner has 70-80% of their wealth tied up in their business. That’s a lot of eggs to carry in one basket. On top of that, private businesses are less liquid and more risky than stocks, bonds and real estate investments. Fortunately owners can control the value and sell-ability of their businesses. Now, whether they exercise that control is another matter! Reason 2: Many Sales Are Unplanned …
Failing to Plan Your Exit is Planning to Fail
November 21, 2019 / in Exit Planning, Sell a Business / by Al Statz
Ben Franklin is credited with saying, “If you fail to plan, you are planning to fail.” And Warren Buffet once said, “Someone’s sitting in the shade today because someone planted a tree a long time ago.” These sayings are great reminders for business owners looking to exit. For most business owners, their company represents the lion’s share of their net worth. It also represents their life’s work and a legacy worth protecting. Getting their exit …
Opportunity Zones: a Compelling Tax-Advantaged Investment for Business Sellers
November 17, 2019 / in Exit Planning, Sell a Business / by Bob Altieri
Cashing in on the sale of your business is the final reward for many years of dedication and hard work. Then your CPA tells you how much you will owe in taxes. It’s a shock, but there’s a relatively new reinvestment opportunity that may help trim your tax bill … In April 2018, The U.S. Department of the Treasury and the Internal Revenue Service (IRS) designated Opportunity Zones in 18 States. The Tax Cuts and …
California’s AB5 Law May Impact Small Business Values
October 2, 2019 / in Business Valuation, Exit Planning, Sell a Business / by Adam Wiskind
Assembly Bill 5 (AB5), signed into law last month by governor Gavin Newsom, will impact the valuation of many small businesses in California that have grown to depend on independent contractors. For impacted owners intending to sell in the near term, this new law may require a change of plan. The new law, which goes into effect on January 1, 2020, creates an explicit three-part test for whether a worker can be classified as an independent …
Understanding the Value of Intangible Assets
September 6, 2019 / in Business Valuation, Exit Planning / by Joe Orlando
As a follow-up to our recent post on profiting from intangible assets in a business sale, this post introduces intangible asset valuation. As our last post outlined, “intangible assets are identifiable, non-physical in nature. They are something you can describe, document … and, most importantly, transfer.” Once identified, there are several ways to value intangible assets. I’ll discuss a common approach called the “with and without” method, using a simple and recognizable case study. Let’s …
Exit Strategies Advises Olympus Controls on Sale to Applied
August 26, 2019 / in Exit Planning, News, Sell a Business / by Al Statz
PORTLAND, OR (August 22, 2019) — Exit Strategies Group, Inc. is pleased to announce that Olympus Controls Corp. has been acquired by Applied Industrial Technologies. We represented Olympus and its shareholders as their exclusive M&A advisor. Established in 1998, Olympus Controls is a leading distributor of world-class machine automation products focused on assemblies and engineered solutions. Olympus specializes in motion control, robotics, machine vision, sensor and IIOT technologies, and is one of the largest and …
Profit from Intangible Assets in a Business Sale
August 10, 2019 / in Business Strategy, Exit Planning, Sell a Business / by Al Statz
The sale of a business includes intangible assets. This article explains what intangible assets are and how articulating, supporting and protecting them enhances business sale outcomes. Let’s get started. What is an Intangible Asset? Intangible assets are things that are non-physical in nature that you can identify, describe, document (e.g. a contract, list, logo, drawing or schematic) and, most importantly, transfer. Intellectual property is an example of an intangible asset. The Financial Accounting Standards Board …