the Value of a Business Buyers look at earnings as a primary driver of value. There are many other factors such as strategic value, competitive position, branding, secret processes, and cost to duplicate. There are also many other factors, some not so evident or obvious, some intangible and some in the “good feelings” attitude about the business or its prospects. At the end of the day, it is sometimes hard to pinpoint exactly what made the difference for the buyer to close on the transaction. This article presents 64 items that can either increase or enhance a business’ value, or…
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Must Know Accounting Rules Earnouts are often used in transactions to bridge the gap between what a buyer is willing to pay up front and what a seller wants in the way of total compensation to complete a deal. Therefore, earnouts are typically constructed to allow the seller to enjoy additional upside if the acquired company reaches certain performance targets after the sale while providing the buyer with downside protection if the projected performance after the deal closes does not materialize. That said, practitioners must understand accounting rules that could result in an earnout not being deemed an earnout. The…
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Meet Your Advisory Team Selling a business is a one-time process for most owners. It is also a harrowing process involving professionals in many disciplines. Here is a description of the primary people assisting in the process.