Due diligence is a term most of us have heard somewhere at some point. But what does it actually mean and how does it play out in specific contexts? At The DVS Group due diligence is an essential part of our dealmaking.
Valuation is calculated. Price is negotiated.
That’s one of the most important things to remember about the process of business valuation.
Business valuation is a topic that goes deep and wide. There are a lot of questions and a lot to learn.
We did the digging for you and created the second in our series of “Ultimate Guides”.
(The first in the series: The Ultimate Guide to EBITDA)
After engaging with the information below, we hope you come out on the other side with a good understanding of why valuation is calculated and price is negotiated.
We talk about EBITDA often in our office. The financial measure is important when valuing a business. Business owners, buyers of businesses and even financial advisors can be at a loss for what EBITDA truly means because it is mainly used in the sale of a business- an event they’ll likely experience once.
There is a heap of questions out there regarding EBITDA. And there is an equal amount of answers. We weeded through the resources out there and found the best answers to your EBITDA questions.
If you’ve ever considered purchasing a business, the thought right after, “I can be my own boss!” is likely “Can I even afford it?” Business ownership is rewarding in many ways- beyond finances. But it also brings lifestyle changes that impact those around you. It’s an investment you want to be confident in.
We won’t talk in absolutes about whether or not you can afford to buy a business. But, after a decade of seeing executives buy businesses, we’ve developed two frameworks that work in tandem for helping you answer that question.
As merger & acquisition professionals, we know that much of our job is education. The work we do day-in and day-out is a little bit complicated, a little bit obscure, and a whole lot different than a business owner’s day-in and day-out work. We value and enjoy our role as educators but sometimes we get frustrated when our clients get tunnel vision and choose to focus on any problem but the one that matters. We find ourselves having the wrong conversation over and over.
Buying a business is hard work. Are you ready for that task? Below are six questions to help you find out. These questions are tailored specifically for the individual executive seeking to acquire a business (a different set of questions should be asked by corporate buyers). If that’s you, take some time to consider these questions.
Thanks to Kirk Kaiser for contributing this post to The DVS Group blog. He is an owner of Barrier Technologies. He founded the company in 2008 with Jaye Sieland. Barrier Technologies is a national containment contractor that specializes in preventing the spread of fire, smoke, sound, water, and infection in buildings.
Jeff Hutsell sold his company, Levels of Discovery, in 2013. Recently, we interviewed Jeff to find out what he recalls about the process and what advice he has for others.
Is business ownership a valuable experience? Read the story of Robert Drumm, a DVS Group client, to find out.
Lawyer, brewer of beer, writer, dad, husband – all words used to describe Robert.
In 2013, he was ready to add one more role to that list – business owner. Read more
Use the following definitions to get accustomed to the lingo of the Small Business Administration (SBA).
“Which industry is best for
my business acquisition?”
Whether you are a corporate or individual buyer, one of your first questions in the process is likely that question.
Let me tell it to you straight – no industry is the best industry.
And I’m not just saying that so I don’t hurt any of the industries’ feelings.
You may have preferences and some industries may be better than others but, speaking from experience,
there is not a golden ticket industry that will take you to the chocolate factory of ideal businesses.
How does the SBA 7(a) loan program compare to a conventional bank loan?
The Small Business Administration (SBA) has many resources for business owners. Money is one of them – certainly enticing for anyone looking to start, scale or shift directions in their business.
Are you properly settled in for the ride as a Blue-Chip Executive on the journey to buy a business?
The journey can be long and arduous, and you might get lost and never arrive, or crash on the way, or get distracted, or wind up at the wrong destination.
So, as you’re buckling your seatbelt, examine the ways your journey to buy a business could get derailed and then, take our tips to heart – they will help you stay on track.
Jason Andrews, current owner and CEO of GroupSource Group Purchasing, had spent much of his career in the medical device space. He had a lead sales job managing a remote team in a large geographic area. Jason’s job required a lot of traveling. He was expected to be continually growing and building the company for somebody else, for those above him in the hierarchy. He was ready for a change.
You found the business you want to buy. Congrats!
There are many things that need to happen before a deal closes. One of the first steps you’ll need to take is to write, sign and negotiate a Letter of Intent (LOI) with the seller. An LOI is a non-binding document, meaning there is not a legal requirement for things to play out exactly as the document states.