SELLING PRIVATELY HELD BUSINESSES


–SINCE 1982–

Articles & News

What NOT to Do When Selling a Business

Below are 3 aspects to consider and avoid when selling a business. 1) Advertising Too Early While there are many reasons to start advertising a business as soon as possible (especially to take advantage of the high buyer activity seasons like at the first of the year), we constantly see businesses advertised too soon. When a buyer inquiries but financials are not in order and other key aspects of the business are still not available, this can really turn off well qualified buyers who are seriously looking for a business. This is often not the fault of the seller but

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Will 2022 Be a Good Year for Selling a Business?

Will 2022 Be a Good Year For Selling A Business? As many start to plan for next year, there are several important factors to consider for those owners looking to sell their business in 2022.   While these past few years have been anything but normal, the following three key traditional factors in selling a business remain: 1. Multiples Determine Value  Whether it’s a multiple based on SDE or EBITDA for measuring cash flow, valuation multiples remain relatively the same compared to 2020 with one exception.   In the recent Q3 of 2021, for businesses valued over $5M, EBITDA multiples

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Annual M&A Source Conference

  Our firm’s team of M&A advisors continually strive to improve our understanding of current market conditions and the latest industry trends.   In mid-October, the M&A Source (www.masource.org) held their annual conference in Houston, Texas.   Due to the pandemic, it had been two years since the last in-person event was held so this was a great event to reconnect and network with over 150 individuals representing firms throughout the US.  Both Rob Amerine and I came back with the following key take-aways. Despite some pandemic set backs and delays, the rate of business acquisitions remains healthy as more buyers

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[Podcast] Rob Amerine Talks Business Transactions & Selling Strategy on KRDO

Rob Amerine is guest speaker on KRDO’s, The Extra with Andrew Rodgers The FBB Group’s, Senior Broker, Rob Amerine was guest speaker on KRDO’s podcast, The Extra with Andrew Rodgers on Friday, September 17, 2021. The biggest misconception is thinking you can sell a business tomorrow, the reality is preparation for a successful sale can take 3-5 years. Rob talks about how to position your business for a successful sale, the recovery of businesses and the current market. Listen below to hear about the importance of successful small business transitions, the pros/cons of starting vs buying a business as well as

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Professional Services in Business Transactions

We are often asked by both Buyers and Sellers if they will need an attorney or accountant in a business sale or if my firm, providing intermediary services will handle all of the documentation.  The answer is that business transfers are complex and require the use of multi-professional disciplines.  Additionally, there is the issue of conflicts of interest.  In this month’s article, I will address the roles of some of the professionals that we often see in a transaction. ACCOUNTANTS For Sellers, the accountant will play a key role in preparing the business to go to market.  It is essential

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Management Buyouts

Selling a business to one or more employees can result in complex and emotionally taxing negotiations. (For the purposes of this article, I will assume that we are dealing with a single employee, as dealing with multiple employees make it even more complex.)  On one hand, the business owner may have a desire to transfer the business to a team member that has a thorough knowledge of the business operations, which makes the transition more streamlined.  On the other hand, the employee may feel entitled to a significant discount in value as the employee believes that he or she was

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The Big Exit?

Many of my experienced peers in the M &A Advisory industry remember a book that was published in 2005, “The $10 Trillion Opportunity”, authored by Richard E. Jackim and Peter G. Christman.  In summary, the book highlighted the opportunities in the business exit profession, as aging Baby Boomers with privately held businesses were aging out and starting to exit their businesses.  Part of the concept was that this was the beginning of the tidal wave and there would be more businesses than buyers in the market. Well, like many predictions, the tidal wave never fully materialized, due in part to

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Timing Your Business Acquisition in 2021

There is an old saying that “timing is everything“. That is especially true in the investment world. Be it the stock market or buying a business, timing can be critical to the rate of return on investment or even the survival of the investment. Although there are many people far more qualified than me to address the timing in the stock market, I will address the timing of business acquisitions in the current market. Business Acquisitions in the Current Market In addition to what my team is experiencing at the FBB Group, conversations that I have with business intermediaries across

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The Current Status of the Business Transfer Market in Colorado

Not all markets are created equal. In Colorado we are fortunate that we reside in a state with a dynamic economy and a high quality of life. Consequently, for better or worse, we have significant in-migration which is helping to fuel strong job and housing markets. To a certain extent, this is a variation of the old “did the chicken or the egg come first” question. Are companies relocating and expanding in Colorado because of a growing workforce or are people relocating to Colorado because of the strong job market? In any event, the labor market is a significant factor

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Proposed Tax Increases That Can Impact the Sale of a Business

Recently the Biden administration has proposed numerous tax increases to pay for its infrastructure plan.  Two of these changes, an increase in the Federal Capital Gains Tax, and changes to the Estate Tax can have significant tax implications to entrepreneurs.  We will address both proposed changes below. Capital Gains Taxes For capital gains taxes to apply, an asset needs to be owned by the taxpayer for a year or longer.  The gain is calculated by taking the sales price, less appropriate expenses of sale, and subtracting the taxpayer’s basis.  (Note: This calculation can be more difficult than it seems, and

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