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July 29, 2015 |
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The key man discount can take a zero off the value of your business. Find out why and how to avoid this trap when selling your business.
In this episode of Built To Sell Radio, you’ll hear an interview with Jeff Davis, who sold his business Legal Artworks back in October 2014. Learn how Jeff got to the point of only going into the office once a week, how he avoided the ‘key man discount,’ and why he didn’t sell his business to the highest bidder.
By his 30s, serial entrepreneur Jeff Davis had already built multiple nationwide companies and was featured in Fortune Magazine, CNN.Money and by countless other news stories. In 2014 he successfully sold his medical-legal trial presentation company to a Bio Tech out of Michigan so he could dedicate his life to helping other entrepreneurs and CEOs grow their businesses by facilitating roundtable groups and other events designed to help entrepreneurs and CEOs be more successful.
The Inside Story Behind Sage’s 8 Figure Acquisition of a 12 Employee Company
In 2016, Ashford took what little was left after his business failed and invested £4,000 in developing proposal software for accountants which he named GoProposal. By 2020, GoProposal was a slick application with £1.5 million in revenue and hundreds of accountants using it. That’s when Ashford agreed to be acquired for a healthy 8-figure sum.
Why Cracker Barrel Paid $36 Million For Maple Street Biscuit Company
When Scott Moore’s job as a VP at Winn-Dixie was eliminated in 2012, he decided to start a restaurant with his friend Gus Evans in Jacksonville, Florida. They called it The Maple Street Biscuit Company and offered what they refer to as “comfort food with a modern twist.”
In 2015, Lorenzo de Plano co-founded Solace Technologies, one of the first vape manufacturers in the United States. The goal of the business was to create a discreet vape pen that customers could use as an alternative to smoking cigarettes.
The business boomed to revenue of more than one million dollars a month, but a looming threat had de Plano eyeing an exit. So, when a $15 million offer came in, he bit.
3 Things to Consider Before Shopping Your Business
Leona Watson started Cheeky Food Events, where they offered companies cooking lessons as a team-building activity.
Over 17 years, Watson produced 3,000 events for more than 85,000 people. Watson hit $3 million in sales when she realized it was time for her to start thinking differently about her business.
Inside the Mind of An Acquirer – Nathan Winch
U.K.-based Nathan Winch started his career as a private equity investor after selling his first company, Winch Pharma, in 2017.
Since then, Winch has acquired over 20 businesses, with a focus on logistics and infrastructure companies.
An Interview with The E-Myth’s Michael Gerber
For the better part of 40 years, Michael Gerber has been encouraging business owners to work “on, not in” their business. Gerber’s knack for simplifying the complex art of starting and growing a company really resonates.
How to Punch Above Your Weight Class With Acquirers
Peter Carlin started Logicearth to improve how companies teach their employees online. They built e-learning courses that were almost as good as being there in person. They caught the attention of a marketing agency called The Creative Engagement Group (TCEG), which had clients that needed online courses.
Bootstrapping to a $200 Million Exit
In 2012 Patrick Campbell founded ProfitWell to help SaaS companies increase revenue and reduce churn by managing their data in a single place.
After bootstrapping the business to 8-figures, Campbell decided it was time to raise money. While he was seeking a financial investor, Paddle approached him with an acquisition offer. Soon after, in 2022, Campbell sold ProfitWell to Paddle for over $200 million.
The Strategic vs. The Financial Buyer
Tom Franceski and his two partners built DocStar up to 45 employees when they decided to shop the business to some private equity (PE) investors. The PE guys offered four to six times Earnings Before Interest Taxes Depreciation and Amortization (EBITDA), which Franceski deemed low for a fast-growing software company.
The External vs. Internal Sale
Barry Wood sold two virtually identical businesses over an 18 year period. The first was external and the second, internal. His exits clearly show the differences in an as close to apples-to-apples comparison as possible. The pros and cons may surprise.
Selling a Main-street Business
Jim McManaman started his accounting firm in a small town of 3,000, so when he decided to sell, he had to figure out how to do it without tipping off his employees.
The Acquisition of the Company Behind Chicago Bulls Sunglasses
If you own Chicago Bulls sunglasses—or sunglasses from just about any other NBA team—you owe your eyewear to Jason Bolt.
