There is no easy way or ‘one size fits all’ approach to estimating the M&A market value of a business. No two businesses are the same and there are several techniques for approximating the value of a company at any given time. At the end of the day, the only way to determine the actual value of a business is to find out the price at which a willing buyer and willing seller will agree to do a transaction. That said, there are numerous factors that directly impact the value of any business, typically including size, growth rate, profit margins, risk, financeability, competitive process and current market conditions.
BUSINESS OWNER ALERT! Educate Yourself Now on the Potential Impact of Likely Tax Increase on Net Proceeds: What You Don’t Know Can Hurt You (and Might be Very Costly)
The maelstrom of events of 2020 and early 2021 would certainly provide a plausible excuse for business owners to focus on many other priorities than likely changes to the tax code. However, the tax changes proposed by President Biden will have a significant impact on the net proceeds that would be realized by a business owner in a sale transaction. Every owner should make time right now to understand exactly what this may mean to them, regardless of their short- or long-term goals.
Given everything that happened in 2020, many business owners have found themselves thinking about the potential timing and preparation for selling or exiting their companies. Some business owners have had to delay timelines for a sale due to the impact of COVID-19 on financial performance.
This is not as straight forward a question as many business owners might believe, nor is it as simply answered as many advisors may claim.
As the owner of a successful mid-market company, you probably receive numerous inquiries throughout the year from larger corporations, private equity firms, and competitors looking to acquire your business.
Successfully selling a business takes a significant investment of time and energy. Transitioning the company you’ve worked hard to build should be executed in a way that achieves your primary goals and objectives.
In my 40 plus years on Wall Street, I have met regiments of investment bankers. There have been none – i.e., not one – with the combined talent and integrity of Kevin Dunn.
John Adams, Founder, Adams Harkness & Hill and Chairman, Canaccord Adams (US)
Dunn represented, marketed and successfully sold our business. My partner and I interviewed a number of investment bankers prior to the transaction and chose Kevin because of his broad industry experience, professional reputation and ability to get deals done. Kevin and his team learned everything about our business and put together a comprehensive offering memorandum which generated tremendous interest from both private equity and strategic buyers. Kevin conducted an efficient auction of our company and was able to “walk-up” the ultimate sale price substantially. We never second guessed our decision to hire Kevin and I strongly recommend him for consideration for your project.
Rick Thibadeau, CEO and Owner of AW Direct
I was approached by multiple potential buyers and knew I needed help to navigate the process while continuing to run my business. Dunn Rush was instrumental in organizing the data room, managing the bidding, facilitating negotiations, maintaining positive communications, maximizing the sale price and getting it over the goal line. I highly recommend Kevin and Greg.
Bob Keeley, Former Owner and CEO, Diversified Project Management, Inc.