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A Difference of Opinions: Closely-Held vs. Venture-Backed Companies- Part 2 of 2
June 8, 2023 / in Business Valuation / by Joe Orlando
In Part 1 of 2 of this blog, I spoke about my transition from valuing venture-backed technology startups to valuing owner-operated small to middle-market businesses with $2 million to $50 million in revenue. As part of that discussion, I set the stage for three differences in how these types of businesses are valued, specifically differences in Diligence, Tools, and Approaches. Part 1 looked at Diligence and Tools, and Part 2 will complete this discussion with …
Representation and Warranty Insurance in M&A
June 6, 2023 / in Acquire a Business, Exit Planning, Sell a Business / by Exit Strategies
When selling your business, you make a set of promises to the buyer. You “represent and warrant” certain facts about the business. Essentially, you’re certifying that you provided accurate information and there are no known issues pending (e.g., financial, legal, tax, compliance, etc.). If it turns out those promises are false, the buyer has the right to recoup a percentage of the purchase price. Non-fundamental reps and warranties (typically all items aside from key …
M&A Glossary: Confidential Information Memorandum
June 6, 2023 / in Exit Planning / by Exit Strategies
A Confidential Information Memorandum (CIM) is a summary of your business used to help pre-screened buyers determine their interest. A CIM contains overview information about your operations, financials, industry trends, and growth prospects. As your investment bank, we’ll prepare the CIM for you, with your cooperation and review. You approve all material before it’s presented to a buyer. The CIM is only distributed to a select group of vetted, qualified buyers who have signed a …
Selling your business should not be a 50/50 coin flip
May 30, 2023 / in Exit Planning, Sell a Business / by Exit Strategies
So, you’re ready to sell your business. You have an M&A advisor helping you, your numbers are in order, and you’re feeling confident. But did you know that only half of businesses will successfully sell—and that’s with a qualified advisor? For years, member advisors of the International Business Brokers Association and the M&A Source have been reporting their quarterly closing rates in the Market Pulse Report. Every quarter, roughly 50% of deals terminate without a …
M&A Glossary: SDE vs. Normalized EBITDA
May 30, 2023 / in Exit Planning / by Exit Strategies
M&A Glossary: SDE vs. Normalized EBITDA Seller discretionary earnings (SDE) and normalized EBITDA are two common measures used to assess the profitability of a business. While they are both used to determine a business’s value, they differ in the expenses and adjustments made in their calculations. Seller discretionary earnings (SDE) is a measure of the business’s cash flow that includes the owner’s compensation and benefits, as well as perks and discretionary expenses that are not …
A Key Performance Indicator to Improve the Results of your Testing Lab Exit
May 22, 2023 / in Business Strategy, Sell a Business / by Adam Wiskind
When preparing to sell your Testing Laboratory using Key Performance Indicators (KPIs) can help to focus your efforts and resources in the right areas. While numerous KPIs exist, one metric that should be on the radar of all business owners in the testing laboratory industry is the Sales/Employee Ratio. Labor costs make up the largest single expense for Laboratory Testing businesses, accounting for an estimated 38.4% of industry revenue in 2022 (IBIS WORLD July 2022). …
Exit Strategies Group Advises Shepherd Controls in Sale
May 14, 2023 / in News, Sell a Business / by Al Statz
May 2023 – Exit Strategies Group is pleased to announce that it represented Shepherd Controls & Associates, a leading regional supplier of industrial automation products, in a recent sale to Flow Control Group, a portfolio company of KKR. Shepherd Controls & Associates, founded in 1985 by Ron Shepherd and Bill Benko, is headquartered in Allen, Texas. The Company has branch offices in El Paso and Houston and serves the Gulf states and Mexico. It offers …
Adam Wiskind and Roy Martinez Complete Certified M&A Professional Program
May 6, 2023 / in News / by Al Statz
Exit Strategies Group is pleased to announce that Senior M&A Advisors Adam Wiskind and Roy Martinez are now two of more than three hundred M&A intermediaries and professionals with the CM&AP designation. The Certified M&A Professional Program is offered by the Coles College of Business at Kennesaw State University in conjunction with The M&A Source. The Certified Mergers & Acquisitions Professional (CM&AP) Program provides participants with the analytical and business tools needed to manage successful …
Exit Strategies Advises IRR Los Angeles & Orange County on their Sale to CBRE
April 17, 2023 / in News, Sell a Business / by Roy Martinez
Exit Strategies, a California based mergers and acquisitions (M&A) brokerage and business valuation firm, recently advised the owners of Integra Realty Resources of Los Angeles and Orange County on the sale of their Southern California commercial property and right-of-way appraisal business to CBRE Group, Inc. IRR Los Angeles co-owner, John Ellis, said, “Roy Martinez of Exit Strategies helped us understand the value of our business and introduced us to resources needed to complete the transaction. …
Cornerstone International Alliance sets new record: $1.3 billion in business transactions
April 14, 2023 / in News, Sell a Business / by Al Statz
Exit Strategies Group is a partner in the Cornerstone International Alliance After a record setting year in 2021, Cornerstone International Alliance members, a consortium of industry-leading lower middle market mergers and acquisitions (M&A) and investment banking firms, shattered that record in 2022, completing 169 deals with an enterprise value of more than $1.3 billion. “2021 was a milestone year with $1.1 billion in deals closed for the first time. So to have another record year …
Exit Strategies Group, Inc. is a leading provider of business sales and acquisitions, business valuations, and exit planning services for family owned and closely-held companies since 2002.
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