According to surveys, up to 79% of business owners plan to exit their businesses within the next 10 years, with more than half saying they want to exit within the next five years. However, many business owners fall into the trap of the "rolling five-year Exit Plan," in which owners constantly reset their exit dates for five years later. This often prevents them from taking tangible steps to accomplish their exit goals.
To highlight the consequences of setting an exit date, let’s look at a case study involving a business owner, Charles Franklin, and his Exit Planning Advisor, Mathilda Traubert.
Charles met with Mathilda to discuss the first steps he needed to t... Read More
When you set about starting your business, you likely had big goals and expansive dreams about its success. Whether success meant having an impact on your community, making as much money as possible, or something else, you probably wanted your business to become the ideal firm in your market.
As you build your business toward the ideal, you concurrently build your business’ value, which is a key aspect of a successful Exit Plan.
Does this mean that hiccups, stalls, or unforeseen failures in the growth of your business’ value will directly affect your business exit? While that can be true, proper planning helps mitigate those kinds of fluctuations. Consider the... Read More
The idea of exiting their businesses, which for many owners define their professional lives, can seem like a gigantic undertaking. They ask themselves, "How can I possibly do all of this? Where can I go for help, and what do I need to know?"
These questions are perfectly normal to ask as you consider your business exit. Further, business owners are absolutely correct in thinking that Exit Planning is a gigantic undertaking. No single business owner or advisor can create and implement an Exit Plan alone. In our experience, most successful Exit Plans occur through a process of collaboration among several different professions.
It can be stressful to go someplace... Read More
An important part of a successful ownership transfer, regardless of Exit Path, is the presence of key employees. Key employees are those who have a direct and significant impact on business value, meaningfully participate in the business’ strategic future, and whose combination of skills and experience would be exceedingly difficult to replace.
Because of their role in the business, key employees can just as easily stall your business exit as facilitate it. Consider the story of Maria Villalobos, who had her Exit Plan stalled by one of her key employees.
Maria Villalobos was nearing her retirement. Over 30 years, she b... Read More
10 Things That Make Your Business More Valuable Than That of Your Industry Peers
The value of your company is partly determined by your industry. For example, cloud-based software companies are generally worth a lot more than printing companies these days.
However, when we analyze businesses in the same industry, we still see major variations in valuation. So we dug through the data available to us from our partners at The Value Builder System™ and we found 10 things that will make your company more valuable than its industry peer group.
1. Recurring Revenue
The moe revenue you have from automatically recurring contracts or subscriptions... Read More
Is Now the Time To Sell Your Business?
Have you been thinking about selling your business but just can’t decide if now is the best time? Do you find yourself repeatedly analyzing the economic situation and wishing you had a crystal ball? There are positive signs and there are negative signs….
If you’re still up in the air and can’t quite decide whether or not to hit the eject button, here are six reasons you might want to consider getting out now.
1. You’re less interested in fighting the good fight
A lot of business owners took the Great Recession in the teeth. If you’ve got your business stabilized and the prospect of possibly having... Read More
Across Iowa, we are experiencing a ‘silver tsunami’ of aging baby boomers. One area of our economy we know this will affect is the changing of ownership in family-owned companies. It is well documented that only about 30 percent of family firms make it to Generation 2 (G2) and a tiny 12 percent make it to Generation 3 (G3). These transitions must be planned carefully and proactively to ensure the firm survives.
So how do we do that?
Let’s consider a simplified five-step approach to help organize what can be a very challenging process:
1. Communicate Objectives/Goals/Timelines
The focus here is on “Communicate”. Existing ownership and the next generatio... Read More
As owners set out to begin creating a written Exit Plan, they may want to know that the most successful owners tend to establish their goals before they begin implementing a process. This newsletter outlines the three types of goals most owners set
With the new year upon us, many people have begun their journeys to fulfill their New Year’s resolutions. For business owners, it’s no different. Between creating goals for the business to achieve and assuring that the business keeps growing, owners will have much to consider this year. One of the goals most commonly shared by owners is to successfully exit their businesses over the... Read More
It’s the Christmas season – which for a lot of us is a busy time of gift buying, wrapping, and quality time with your in-laws. However, if you have the job of Programming Manager for the Freeform Channel (what a sweet gig) – this is when you book that trip to Maui. It’s basically an auto-shuffle of “Elf”, National Lampoon’s Christmas Vacation, The Polar Express, and of course The Santa Clause franchise.
I found myself scrolling the channels last night and stumbling upon Tim Allen’s version of Saint Nick. The bowl game that was on didn’t look very interesting, so somehow I zoned out on The Santa Clause – Part 1 (which should have been the only one made in my humble opinion) But... Read More
When planning business exits, many owners overlook the possibility that they will die or become permanently incapacitated before they complete their exits. In such tragic cases, owners’ families are often left responsible for the business, whether they want it or not. This newsletter presents strategies that can help families of deceased owners handle business matters in the most difficult times.
As owners approach their business exits, one topic that’s often overlooked is unexpected death or permanent incapacitation. One reason owners gloss over this topic is because it injects an uncontrollable element into a controlled process. Many successful business owners take pride in th... Read More