“I’m thinking about selling my company – I need a valuation.”
That’s how many conversations begin. I had one again recently.
It was in a conference room with the President of a privately-held company. The business was growing quickly, and was very profitable. They had been approached by competitors in the past but the timing wasn’t right.
Until now.
This person was lucky
“What is my business worth?”
That’s one I get a lot… “Give me a rough idea – back of the envelope.”
And as an old mentor of mine known as ‘Dr. Value’ would say: “It Depends.”
Most people don’t wake up one morning and think: “I wonder what my business is really worth?”
Ok, some do. But then they usually lose that
Your house and your investment portfolio are significant portions of your liquid assets, and you probably have a general idea of what both are worth at any point in time.
But if you’re a business owner, there’s a good chance that you don’t know the value of your business, even though it may be your largest source of wealth.
Many
Before they were Rock & Roll Hall of Famers, Def Leppard was a group of ambitious teenagers from Sheffield, England, chasing a dream.
Formed in 1977 by drummer Rick Allen, bassist Rick Savage, and guitarists Pete Willis and Steve Clark, the lineup solidified with frontman Joe Elliott. They emerged at the tail end of the 1970’s as part of the
Unless you do what I do for a living, “valuation” probably isn’t a word you hear every day.
But it is a word you hear a lot on the TV show Shark Tank.
And it’s usually a point of controversy.
But why do the entrepreneurs and the Sharks differ on valuation?
The Pitch
The entrepreneurs are passionate about their business and
“I’ll have a cola.”
Ever say that at a restaurant or stadium?
You more than likely have said “I’ll have a Coke” or “I’ll have a Pepsi” but probably not “I’ll have a cola.”
That’s the power of branding.
A key element of differentiating from the competition, a powerful brand can illicit loyalty from satisfied customers and typically allow a company to
In the world of business valuation, traditional models have long prioritized financial metrics such as earnings, assets, and cash flow.
But as businesses evolve, especially in service and technology sectors, intangible assets, particularly human capital, have emerged as pivotal drivers of success. Despite the critical role of employees, conventional accounting and valuation methods fall short in capturing the true value
“Valuations are up.”
“Multiples are very attractive now.”
These are comments that get business owners and shareholders excited, but what does it really mean for you?
If you’re at a publicly traded company, you can check your firm’s stock price and generally know what those comments mean for you, but if you’re at a privately held company you don’t have
Valuing a business is one of the most important tasks for business owners and yet, many business owners and their CFOs have no idea of the true value of their company.
According to recent survey data published by CNBC, 98% of small business owners didn’t know the value of their companies.
A business valuation determines the fair market value
At some point, every business owner thinks about an exit – whether that’s selling to a third party, transitioning to the next generation, or bringing in an investor. The key to getting the best valuation isn’t just about revenue or profitability; it’s about building a business that runs smoothly, generates predictable cash flow, and doesn’t rely too much on you.