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Last Update: Monday October 23, 2017

Exit with your equity, but leave the heart

Think Now About Later

1:23 | Play Now | Hattie says you need to start thinking now about how you will leave your business because it is your baby and it will grow up. Businesses do have a life cycle.

The world:  Most of us small business owners do OK competing with the big businesses in our industries or we don't survive. But when it comes to our exit strategy and succession planning, most of us fall on our face.

This episode is to explores business valuation and exit strategies.

Nobody wants to see you liquidate. That's getting pennies on your dollars. Tangible assets get sold (fire sales) and the intangibles are lost forever. Liquidation is the worst kind of liquidity.   An exit strategy is just like doing a will, but here you try to maximize the dollars you get out of our life's work.  

Most of us will sell our business through merger or acquisition. But, if we get much over two-to-three times sales or six times earnings, we all think we've done very well. Yet, when big business sells, they usually begin at six times earnings. Then we see 40 times and even 300 times earnings on the open markets. Why should we be satisfied with so little?  

Most of us don't think about our incorporation stock certificates... if these could be sold to anyone. Yet, once you do your first business valuation and study your key ratios, you begin to focus on creating a transferable asset. Even our 17+ million sole proprietors – we all should grow in a way that the knowledge base and the intangible assets can be transferred.

Walk Away

3:02 | Play Now | Close the doors. This is your right. You own the business and you can close it down.  Ray DiSanto's company melted away when he died suddenly.

Give It Away

1:25 | Play Now | Rather than writing herself a big, fat check and walking away from Ebby Halliday Real Estate Company, Ebby decided to give 49% of the company to its employees. More...  Her episode...

Sell to Someone Close to You

3:17 | Play Now | Jim Schell sold one of his companies to employees who had demonstrated their ability to take the business and make it grow.    Related...

Sell to Someone Like You

3:11 | Play Now | Peter Schenck found a buyer from his own industry contacts.   Related...

Sell to the Highest Bidder

3:25 | Play Now | Bob Orenstein sold his business for double-digit millions.  Related...   

Sell to Your Employees

2:14 | Play Now | Use an Employee Stock Ownership Plan as the instrument to sell your company to your  employeesRelated...

Sell Through a Public Offering

2:37 | Play Now | While the Initial Public Offering (IPO)  is relatively well examined, the Direct Public Offering is not. Little known among DPOs is the Small Corporate Offering Registration, known as a SCOR.  Stockbroker David Porter explained the benefitsRelated...

Sell Into the Private Equity Market

2:58 | Play Now | Steve Watkins tells us how businesses are selling their securities, the stock certificates we got when we incorporated, within the Private Equity Capital Market.   Related...