Category Archives: Transaction Mechanics

Buyers Are All About Metrics

Last week, Middle Market Executive published an article I wrote entitled Knowing Your Financial Metrics Can Increase Your Company's Value to Buyers (and Make It Easier to Manage Along the Way). While I won't repeat the whole article here, I wanted to draw your attention to a couple of key points. First, while many middle market owners may feel comfortable managing their companies by "gut feel," buyers expect and want more.  Inevitably, buyers (whether financial or strategic) will feel compelled Read More [...]

Why Sell? No Need to Go it Alone.

"Why do you need to wreck this company?  - Bud Fox "Because it's WRECKABLE, all right? - Gordon Gekko A common misconception among entrepreneurs (and the public) is that buyers of businesses channel Gordon Gekko on a regular basis, looking to destroy rather than build. Nothing could be further from the truth.  Buyers can often provide middle market business owners the opportunity to increase their wealth by collaborating on accelerating growth. Buyers, whether financial or strategic, Read More [...]

Calculating your Company’s True Profitability: What Adjustments to EBITDA are Appropriate?

While hardly the only option, it has become fairly routine for middle market transactions to use EBITDA as the measure of value.  EBITDA stands for Earnings Before Interest, Taxes, Depreciation and Amortization.  So, it is effectively a company's net profit plus any expenses incurred for interest, taxes, depreciation and amortization. Despite sounding like a relatively straightforward calculation, it is important to carefully analyze this number along with the company's financial statements Read More [...]

How Long Will it Take to Sell My Company?

Often, one of the first questions I get asked by clients is "how long do you expect a transaction to take?"  While I would love to be able to tell them that it is going to be quick and easy, the real answer is that is probably going to take nine to 12 months to get through a transaction. I try to divide the process into four stages for my clients: Preparation:  From the time I am retained, preparing a client for sale can take as little as one month, but sometimes can take much longer than Read More [...]