I want to look at a minor issue we're facing in our company, and it's a business valuation calculator. Many people look at tools and real estate like Zillow or go through the Kelly blue book on cars and think"Why don't you have an online business valuation calculator?
It's been going on for a long time, and the reality is we'd love to. Problem is it's hard. And so there are some excellent baselines, for example earnings and revenue. We could discuss guidelines and what they look like. What makes it so hard to do is it is possible to take two companies that have the same revenue and earnings, and they are worth hugely different amounts. Literally two, three X the other, and they're barely even as close. This is due to intangibles.
There's so many things to the business of a company such as Intellectual property rights, defensibility tools, and so on that create an extremely complex issue that just asking what are your earnings and how much are you worth? this hypothetically. We're currently working on this issue. It's probably a little early to talk about it, but we're working with an amazing company to address this issue and we're going to find a solution in the near future. But in the interim should you have any questions about how you can increase the worth of your business, or what your business is worth, why don't you give us a call at Freedom Factory. We're looking forward speaking with you in the near future.
How do I prepare my business to sell
Many entrepreneurs aren't sure of how to prepare their business to sell. So you have decided you'd like to sell your business. What do you do now? Well, the first thing you need to do is to get your house ready for your business to sell. Also, take two or three years worth of tax-related tax reports.
Also, financials and put them together. Find them from your accountant and have the documents ready for. Second, if you haven't created an operating manual, this would be the perfect time to do so. You're familiar with how your company operates, and you understand the ways that different departments interact however, when you decide to decide to sell the business we would like to make it as effortless as possible for the transition to an owner who is new.
This value is likely to be taken into consideration in the sales price. So , get your operations manual and new job descriptions together , and put your house in order. The third step is to find, you know, how to put your team together. Find a good appraiser and broker. Determine what your business is worth. Begin to write the story and figure out what you want to accomplish. we going to take the business to market?
When do we plan to launch it? What's the current tax environment. You know, how can I recast my financials? What do I refer to as straightforward. They're going to, we're going to use the information from your EBIDTA or your accountant could do the same thing and then translate it into seller's discretionary cash flow. That is.
A fancy way of describing all the money company earns during the process of filing tax returns. It's a game to reduce isn't it? Tax evasion is a crime. Tax avoidance is very smart. It's why you're looking to spend as low a tax as possible. Then, you have to translate that it's from some of your non-cash expenses depreciation, for instance, some of your discretionary stuff and add that back in to maximize the value.
Flag all the value that your business generates which will make a big difference. Finally, you should know, what industry are you planning to enter? How do we maximize your multiple? And there are ways to be able to do this. Consider the kind of field you're working in. Determine, you're aware the financials of your business.
Make an operational manual to ensure that the transition is as smooth as is possible. And all of this will be is going to help you in forming the best team. Find the best appraisers, locate the right brokers to assist you in preparing your company for selling If you require any assistance contact us here at Freedom Factory.
Is it the right time to sell my business
This is an extremely important issue and when is the right time to market your company? This one is a bit more art than science. It's basically a gut check of your knowledge. We're outside. This is my backyard. It's in my mountain house and is kind of my favorite place.
The first thing I'm going recommend to you is a change of scenery. Get out of the office. Take a break from the commute whether with your family or away. Now figure out some location where you could go, whether you love to fish or ski or go to the mountains , or go to the beach , and whatever you like, go to a place and switch your place of residence and find a place where you feel really comfortable.
Then think about your business. When I think about it, and I think about it in three questions. The first is, am I here and am I clear? Am I really into my business? Do I serve my business or is my business serving me? In my opinion, it's too short to live where you work for your company. Your company is your personal road to more freedom and more prosperity.
What I mean by freedom is pretty easy - doing what you want, when you desire, and as often as you'd like and with whom you'd like. And if you love your work and think, God, this is incredible, and I'm here and I am clear and I'm doing exactly what I'm supposed to do, which is the way I view selling my businesses to other entrepreneurs This is awesome.
And it's not time to sell your business. If you're unsure about that, I'd take a second look and then look at the situation and ask: do I have the right perspective? Are I able to see clearly? view about where I want to go?
I'm planning to expand my business on in the next one, two, three, or maybe or even in five years? What do I need to do in order to resolve it , and also feel fantastic and confident that I've achieved what I've done? If your company is growing at 40% per an year, or 50 percent per year, you probably have a clear vision. It's likely that you're doing a great job and you're probably feeling that you're in the flow. However, if you've been growing by 5% in the last five years, well it's more difficult, and perhaps someone else is able to do it better than you.
If my company is expanding at 5%, I'm looking to sell. I'm thinking, okay. I'm in need of an operator. I'm more of a strategist. And how do we focus on really making something extraordinary, that is focused and purposeful however, your growth rate is a good indicator of that.
The last thing to remember is that you've accomplished what you set out to do if you, were to start your own business, when I entered the business brokerage business, i was aware that I wanted to alter the way that entrepreneurs purchase and sell their businesses. I've started three of the biggest brokerages. I've hired the third one, acquired them to get the people, and I've transformed it into a better market. This is the thing I wanted to accomplish when I arrived here.
However, if you quit your current job and thought about this for a while and then decide to leave, would you feel happy or would you feel like you didn't finish the job you set out to accomplish. Then I re-read the situation and thought that's fine does my company serve me. Do I feel clear and focused every day?
Do I have anything left to do and do I have new ideas to implement the vision? These are the things that will guide you through it. It's an unreliable science, but overall it's really an exercise in gut-check. What do you think? Do you think it's the right time to sell your business?
Since, if I ever think about selling the business in six months, it's too late. So if you have any other questions on this or something else we would consider it our pleasure to assist here at Freedom Factory. We're waiting for you to give us a call
Check out https://freedomfactory.com/sell-my-business/ will give you a free business valuation to find out the worth of your business. Denver business broker Tyler Tysdal will help you to prepare your business for sale.
Call Freedom Factory for a free business valuation
Freedom Factory
5500 Greenwood Plaza Blvd #230
Greenwood Village, CO 80111
Phone: (844-629-8258)
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Ty Tysdal Business Broker
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