One of the great benefits of attending M&A Source events is the opportunity to share experiences with peers and to learn from their experiences. That held true again at the five-day Certified M&A Professional program (CM&AP) sponsored by Michael J. Coles College of Business & The M&A Source.
Exit planning and business broker firms predicted millions of companies would flood the market as baby boomers focused on retirement. These companies were projected to hit the market starting in 2011, the first year baby boomers reached the age of 65. Four years later, these predictions prove to be overly optimistic and the anticipated consequences have not happened.
Preparing a financial forecast is a key step to selling a business. However, most projections don't pass the credibility test. Here are some of their common flaws and how to correct them in order to make your projection believable for buyers.
Managing Director of the SDR Ventures Consulting Division
Last summer, Paul called me to ask if I would help him sell his company. He had built a business from scratch, and after 30 years, his revenues were pushing $30 million, with earnings - before interest, taxes, depreciation and amortization - approaching $3 million.
Understanding your business valuation is one of the first steps of positioning your company to sell. Many business valuation methods focus on the company's financials, specifically sales and profitability. Unfortunately, many business owners focus on these business valuation methods and miss out on other opportunities for increasing the business's valuation.
The quarterly Market Pulse Survey published by the International Business Brokers Association (IBBA), M&A Source and the Pepperdine Private Capital Markets Project found that retirement is the number one reason sellers go to market, but the type of buyer varies with business size as does the approach for ensuring a successful transaction.