$7 trillion of Baby Boomer businesses will be sold by 2030.
A quick and dirty guide to buying one:
A quick and dirty guide to buying one:
1 - The basics: reading
You're going to need to do some reading.
Not a lot, but you'll need to get familiar with the fundamentals of the process.
The most popular books are:
β’ HBR Guide to Buying a Small Business
β’ Buy Then Build
β’ Buying a Small Business for Dummies
You're going to need to do some reading.
Not a lot, but you'll need to get familiar with the fundamentals of the process.
The most popular books are:
β’ HBR Guide to Buying a Small Business
β’ Buy Then Build
β’ Buying a Small Business for Dummies
2 - The basics: learn to analyze businesses
You'll want to learn to analyze deals like the pros.
The absolute best place to do that? The podcasts.
The best podcasts for learning to evaluate deals:
@acquanon
@AcquiringMinds_
You'll want to learn to analyze deals like the pros.
The absolute best place to do that? The podcasts.
The best podcasts for learning to evaluate deals:
@acquanon
@AcquiringMinds_
3 - Get SBA financing lined up
The SBA 7(a) allows 90% financing up to $5 million.
Reach out to folks like @sbabmarks, @LisaGForrest, @SBA_Ray, @SBALenderLyons and @SBA_Matthias to find out your SBA options.
The SBA 7(a) allows 90% financing up to $5 million.
Reach out to folks like @sbabmarks, @LisaGForrest, @SBA_Ray, @SBALenderLyons and @SBA_Matthias to find out your SBA options.
4 - Or, find investors
Perhaps you prefer equity partners vs SBA debt or both?
Folks like @steveressler, @tsludwig, @Sam_Rosati are ready to invest in good deals.
Ask @MikeBotkin_ how he found an investor via @SamtLeslie's newsletter.
Lot of $$ is out there!
Perhaps you prefer equity partners vs SBA debt or both?
Folks like @steveressler, @tsludwig, @Sam_Rosati are ready to invest in good deals.
Ask @MikeBotkin_ how he found an investor via @SamtLeslie's newsletter.
Lot of $$ is out there!
*Note that if you choose to enlist the help of investors over SBA financing, you'll typically need to wait until you have a good deal lined up.
5 - Find a business you like
Time to find a business you'd want to run.
Two options: on or off market
For on-market deals, check out these sites:
@BizBuySell
@microacquire
(@agazdecki)
@buyandsellabiz
More here:
Time to find a business you'd want to run.
Two options: on or off market
For on-market deals, check out these sites:
@BizBuySell
@microacquire
(@agazdecki)
@buyandsellabiz
More here:
6 - Off-market deals
The methods of finding an off-market business for sale are as limitless as your imagination.
The obvious methods:
- Local networking
- Cold outreach
Follow @J_M_Vogt and @Sam_Rosati (two veteran business buyers) for info on how they do it!
The methods of finding an off-market business for sale are as limitless as your imagination.
The obvious methods:
- Local networking
- Cold outreach
Follow @J_M_Vogt and @Sam_Rosati (two veteran business buyers) for info on how they do it!
7 - If listed, discuss the business with the broker
Brokers like @GoodsCapital, @Socalbusinessb1, @ClintFiore, @PlaybookAdvisor represent sellers but will help guide you through the buying process.
Ask them tough questions about the business!
Brokers like @GoodsCapital, @Socalbusinessb1, @ClintFiore, @PlaybookAdvisor represent sellers but will help guide you through the buying process.
Ask them tough questions about the business!
8 - Pick a price
Most small businesses are worth 2 to 5 times earnings.
This typically means EBITDA but for small deals it's seller's discretionary earnings (SDE).
Find the typical valuations for your target industry. They vary!
Follow @Capital4Value for valuation info.
Most small businesses are worth 2 to 5 times earnings.
This typically means EBITDA but for small deals it's seller's discretionary earnings (SDE).
Find the typical valuations for your target industry. They vary!
Follow @Capital4Value for valuation info.
9 - Submit an offer
Offers are typically made in a letter of intent or "LOI"
The LOI will cover the big-picture terms including your price.
Your lawyer can help you prepare this!
Offers are typically made in a letter of intent or "LOI"
The LOI will cover the big-picture terms including your price.
Your lawyer can help you prepare this!
10 - Conduct due diligence
Assuming your offer is accepted, it's time to lift the hood.
You're looking for issues with the business and legal risks.
Folks like @ElliottEHolland
of Guardian Due Diligence, @RomanSB1 of DueDilio and your lawyer can help!
Assuming your offer is accepted, it's time to lift the hood.
You're looking for issues with the business and legal risks.
Folks like @ElliottEHolland
of Guardian Due Diligence, @RomanSB1 of DueDilio and your lawyer can help!
11 - Sign and close!
If the business makes it through due diligence, you'll enter into a purchase agreement (with the help of your lawyer) and eventually close the transaction.
Champagne time!
If the business makes it through due diligence, you'll enter into a purchase agreement (with the help of your lawyer) and eventually close the transaction.
Champagne time!
12 - You're a CEO now what?
The real work begins!
Follow folks like @SamtLeslie, @joshuamschultz, @RegZeller, @WilsonCompanies, @StrongpointRich, @BillDA, @SullyBusiness, @royceard, @thegeneralmills, @girdley
for a glimpse into life as an operator.
The real work begins!
Follow folks like @SamtLeslie, @joshuamschultz, @RegZeller, @WilsonCompanies, @StrongpointRich, @BillDA, @SullyBusiness, @royceard, @thegeneralmills, @girdley
for a glimpse into life as an operator.
**Please note that all information provided in this thread or otherwise by @smb_attorney is intended strictly for educational and informational purposes and not in seeking pecuniary gain or legal employment.**
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