There may come a time that you want to bring investors into your business. You may want investors to provide money, or expertise, or a combination of the two. Yes, you will need a business plan, but the process always begins with a conversation. This article is about that conversation. Having participated in hundreds of them, I have noticed that investors want five questions answered early, before they put a lot of time into detailed analysis of your offer. It is highly unlikely that they will even look at your business plan, let alone invest in your business, until you have answered the five questions...

VALUATIONMartin HollandApril 27, 2017BUYERS, INVESTORS, BUSINESS PLAN, EQUITY, RISKComment

How to Think Like Business Buyers

The value (price, if we’re selling) of a business is what a willing buyer and seller agree it to be. However, assuming both parties are informed and rational, the value of most small businesses is calculated by multiplying annual profit times a “multiple.” The multiple is a number that reflects buyer confidence and often falls between one and seven. So, for example, a business with annual profit of $100,000 at a multiple of two would be worth $200,000.

VALUATIONMartin HollandMarch 27, 2017EBITDA, MULTIPLE, BUYERS, SELLERS, DEPRECIATION, AMORITIZATION, PROFIT Comments