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Sell a Business Insights
Is Private Equity the Right Solution for Your Exit?
September 13, 2017 / in Exit Planning, Sell a Business / by Al Statz
Is Private Equity the Right Solution for Your Exit? Private Equity Groups (PEGs) are disciplined buyers of lower middle-market companies. Most have cash funds and lender relationships in place for the right acquisition opportunities. PEGs often recapitalize a company, where they purchase a majority or minority interest. They bring growth capital and business acumen to unleash the company’s full potential. A recapitalization gives the owner substantial liquidity now, and a second hopefully larger bite of …
Targeting Strategic Buyers for Your Company
August 30, 2017 / in Sell a Business / by Exit Strategies
One aspect that separates M&A advisors from business brokers is the approach used to identify and target buyer candidates. The typical business brokerage approach is largely advertising based. They place a description of the seller’s business on several websites (BizBuySell and others) and then simply await inquiries. Business listing websites are effective for “main street” businesses (restaurants and auto repair shops) where the buyers are individuals and ad-hoc partnerships. However, in the lower-middle market, specialized corporate …
Six Reasons NOT to Skim
August 9, 2017 / in Business Strategy, Exit Planning, Sell a Business / by Don Ross
Pulling unreported cash receipts out of a business is indefensible and unwise under any circumstances, but particularly if the owner expects to exit in the next 3-5 years. All of us during our childhood were offered the parental edict: “Don’t do it, you are only hurting yourself.” So “why”, you may ask . . . now that you are a grown adult, “should I not skim?” Many reasons immediately come to mind and I am certain …
Exit Strategies Advises RST in Strategic Sale to Subsite Electronics
July 6, 2017 / in News, Sell a Business / by Al Statz
Exit Strategies Group, Inc. (ESGI) is pleased to announce the acquisition of its client, robotic inspection equipment manufacturer RS Technical Services, Inc. (RST), by Subsite Electronics, a Charles Machine Works company. Exit Strategies served as exclusive M&A advisor to RST. Acquired by: Since 1984, R.S. Technical Services, Inc. (rstechserv.com) has been a leader in the design and manufacture of robotic video inspection equipment used to monitor and repair municipal water and wastewater collection and conveyance …
Buy Low, Sell High
June 13, 2017 / in Exit Planning, Sell a Business / by Exit Strategies
Timing is everything. Almost everyone is familiar with the world’s greatest tip to stock investors, “buy low, sell high.” These simple words of wisdom are equally useful to private business owners; however, sage advice is not always easy to follow in the same moment you’re reaping the benefits of high profitability. With the current bull market in its eighth year, the lower middle market is economically healthy across many industries. I talk to business owners …
Is 2017 a good year to sell my company?
April 26, 2017 / in Exit Planning, News, Sell a Business / by Roy Martinez
Sellers often ask us if it is a good time to sell their business. My response is usually, “yes, but it depends”. The optimum time to sell a particular business depends on many factors, and this article discusses some of them. First of all, timing depends on the company: How are its business fundamentals? Is it growing? Flat? Shrinking? Is it profitable? How is the quality of earnings? What is the outlook for the business …
Exit Strategies helps ProtoFab Expand its Prototyping Capabilities in the Northern California Machining Services Market
April 20, 2017 / in News, Sell a Business / by Al Statz
Exit Strategies recently advised on the merger of two closely-held Northern California precision machining companies. Founded in 1996 by Grant Kerr, GMAN Precision LLC is a full-service precision machine shop specializing in complex machined parts and services for R&D, prototyping, and preliminary production work. Its markets include aerospace & defense, biotech, electronics, energy, food processing equipment, medical device, and others. ProtoFab, Inc., based in Petaluma, California, is an ISO9001:2008 certified Northern California manufacturer of precision-machined components for …
Do investment bankers, M&A advisors and business brokers actually add value? If so, how?
March 30, 2017 / in Exit Planning, Sell a Business / by Al Statz
Financially savvy company owners, such as private equity groups and diversified public companies, clearly see the value that M&A advisors add, since virtually all of them hire one to run a professional sale process when selling a company in their portfolio — even when they know who the buyers are and which one is likely will pay the highest price. On the other hand, most entrepreneurs only sell their company once. As a first time …
Increase Business Value with Recurring Revenue
March 23, 2017 / in Exit Planning, Sell a Business / by Exit Strategies
Businesses with a higher percentage of recurring revenue generally sell for higher prices. Recurring revenue business models are highly sought after by strategic and private equity buyers because they are perceived as less risky. Future revenue is more predictable and requires less ongoing sales effort and reinvestment. Companies like Salesforce.com pioneered recurring revenue in the software world, creating the Software as a Service (or SaaS) model. SaaS turned the traditional software licensing model on its …
Early-Stage Tech Company Exits
January 11, 2017 / in Exit Planning, Sell a Business / by Exit Strategies
You’ve built a world-class software solution, delivered to customers as a SaaS application or web service. You’ve recruited a team and created intellectual property. Customer retention is strong and the buzz is growing in your vertical market. Each new customer acquisition represents incremental recurring revenue that falls directly to your bottom line – and the company is closing in on cash flow positive territory. Could this be the right time to sell the company? You may be thinking, I’ve barely …