This podcast will talk about a little pain point that we have within our organization, and it's a business valuation calculator. People are looking at tools and real estate like Zillow, or they look at Kelly blue book on cars and they say"Why don't we have an online business valuation calculator?
You've been doing this for so long and, in reality, we'd love to. The problem is that it's difficult. There are some really good baselines, like earnings and revenue, and we could discuss guidelines and how they will look like. What makes it so difficult is you can have two businesses that have the same revenue and earnings, worth significantly different multiples. In reality, two, three X one another, and almost not even as close. This is due to intangibles.
There are a lot of things that go into the business of a company such as Intellectual property rights, defensibility tools that create an even more complicated discussion that just asking how much are you making and are you worth five times this hypothetically. We're now working on it. It's probably too early to talk about it, but we're working with an incredible company to solve this problem and will come up with a solution shortly. However, in the meantime, if you have any questions regarding how to increase the potential of your company or how much your company is worth, why not contact us by calling Freedom Factory. We're looking forward to talking with you soon.
How do I prepare my business to sell?
Entrepreneurs are often confused about how to prepare their businesses to sell. So you have decided you'd like to sell your business. What do you do now? Well, the first thing you must do is get your home ready for your business to sell. Therefore, you should get two or three years worth of tax or tax-related reports.
And financials and put those together. Take them to your accountant and have them ready to go. In the second, if you've never made an operational manual, this would be the perfect opportunity to create one. You're familiar with how your company works, you know how different departments work, but when you sell your business, we want for it to be as effortless for you to transfer the business to a new owner.
And that value is going to be reflected in the sale price. So , get your operations manual as well as new job descriptions together and get your house in order. The final piece is find, you know, how to put your team together. Find a reputable appraiser and broker. Find out the value of your business. Begin to write the story, and then decide how we going to take it to market?
When do we plan to launch it? You know, what's the current tax climate. You know, how can I recast my financials? And what I mean by that is really straightforward. They're going to, we're going to use you EBIDTA or your accountant can do the same thing and then translate it into the seller's discretionary cash flow, which is.
A fancy way of saying all the money business earns as you file your tax returns. It's a game to reduce isn't it? Tax evasion is a crime. Tax avoidance is a smart strategy. So you're seeking to be as tax-efficient and pay as little tax as possible. We need to translate that, you know, into certain of your other expenses depreciation, for instance certain discretionary expenses and then add it back in to maximize the value accurately.
Flag all the value that your company creates, and that's gonna bring about a significant change. Also, do you know what field are you going to be in? How do we maximize your multiple? And there are methods to accomplish this. Consider the kind of field you're working in. Figure out, you know all your financials.
Put an operations manual together to ensure that the transition is as smooth as is possible. And all of this will be will be easier when you put the right team. Find the most qualified appraisers, find the right brokers to assist you in preparing your business for sale, and if you need assistance with this contact us right here, by calling Freedom Factory.
When is the right moment to sell my company?
This is a crucial topic and when is the right time to sell your business? This is a little more art than science. And ultimately it's kind of a gut check of the things you've learned. We're outside. This is my backyard. mountain house , and it's a bit of my home.
The first thing I'm going suggest to you is get an escape. Get out of the office. Escape the daily grind whether with your family or out. Find a area where you can 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're comfortable.
And then think of your company. Then I take a look and I analyze it using three areas. First, am I here and am I clear? Am I really into my business? Are I doing my best to serve my company or does my business serve me? In my opinion, life is too short to live where you are serving your business. Your company is your personal road to greater freedom and prosperity.
And the way I define freedom is pretty easy - doing whatever you like, whenever you desire, and as often as you'd like, with whom you want. And if you're enjoying what you're doing and you think, God, this is amazing, and I am in the right place and am focused and I'm doing what I'm supposed to do in the way I think about selling my businesses to fellow entrepreneurs, then that's awesome.
The time is not right to sell your company. If you're not sure about that, I would consider a bit more and then dive in and say, Do I possess the correct vision? Have I got a crystal clear view of where I am going?
I'm planning to expand my business over the next two, three, or maybe even five years? What do I need to do to get over it , and also feel fantastic and confident that I've accomplished what I've accomplished? If your company is growing at 40% per one year or even 50% per year, then you've probably got an enlightened view. You're probably doing really well and you're probably feeling in flow. On the other hand it's possible that you've grown at 5% over the last five years, then it's more difficult, and perhaps you can find someone who does it better than you.
When my business is growing at five percent, I'm planning to sell. I'm saying, okay, I'm in need of an operator. It's more of a strategic person. How do we concentrate on making something incredible, and you're right on target and focused, but your growth rate will be a big indicator of this.
The final point is, you've done what you were born to do if you, were to start your own company, when I came to the business brokerage business, i was aware that I wanted to alter the way that entrepreneurs buy and sell their businesses. I've founded three of the largest brokerages. I hired, at least one acquired them to get the staff, and have really made it a much effective market. That's exactly the goal I set out to accomplish when I arrived to this place.
But if you left your current business and think about it for a moment, would you feel resolved or would you feel as if you weren't able to finish what you came there to do. Then I re-read it and I say that's fine, is my business serving me. Do I feel clear and focused every day?
Do I have anything I need to accomplish and do I have new ideas to implement the idea? These are the questions which will help you figure it out. It's a little bit of an unreliable science, but in the end, it's an exercise in gut-check. What do you think? Do you think it's time to sell your company?
If I'm thinking about selling it the item, it's usually six months too in the past. So if you have any other questions on this or any other topic, it would be our pleasure to assist you with your questions here at Freedom Factory. So just give us a call
Check out https://freedomfactory.com/ will give you a free business valuation to find out the worth of your business. Denver business broker Ty 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)
https://g.page/freedom-factory-denver
Email Tyler Tysdal Best [Colorado business brokers
https://www.linkedin.com/in/tyler-tysdal
https://www.crunchbase.com/organization/freedom-factory
https://www.youtube.com/channel/UCIlOFFMqyOo1CjtA0Uwp4qw
https://open.spotify.com/show/6QezGjjD1aghJGmChs0586
Tyler Tysdal Business Broker
https://play.google.com/store/books/details?id=wtw9EAAAQBAJ
https://oembed.libsyn.com/embed?item_id=20714141
Watch Video
No comments:
Post a Comment