Problems We Solve
We build powerful solutions out of the toughest problems you face when creating an exit that meets the needs of your business and your retirement. Every engagement starts with uncovering the core challenges you're facing, then leveraging our holistic skill set to plan and execute the solution.
The Exit Eagle Analysis
The Exit eagle Transformation
“I’m the only one in my business who knows how to do what I do.”
A company that repaired a unique piece of equipment for boroughs, cities, towns and manufacturing plants was one of the few in the country who knew how to do it. He had relationships with big accounts that upstream suppliers wanted to get into, but were headed off at the pass. Make a few videos, put a training program together, and now you have a handful of competitors who would bid against each other for the company to lock their competitors out, start a new revenue stream, and expand their client base to include some tough nuts to crack.
The Exit Eagle are training experts and have partners who can provide technical skills. We can help with that.
The Exit eagle communication
“No one believes that my employees know how to do the work. And besides, they worry that the employees will leave when I do.”
It’s a brutal fact of life that sometimes you have to spend money to make money. And in a case like this, there are several alternatives that can be pursued. For example, how about a sales video that includes action shots of the work being done? Or training videos that the new owner can use to learn him- or herself and to train new employees, too. Having documented processes and systems, not just a set of tax returns, to share with a potential investor is a game changer.
And guess what? The Exit Eagle can help with that, too.
Take the Exit Readiness Assessment for FREE:
“I paid a lot of money for a business valuation, but I don’t believe the number that they gave me. How can I find out what the real number is?”
That happened to us, too. When we got the Business Valuation from the accountant (whom we had paid A LOT of money), a 50-page document with all kinds of economic balderdash was sent VIA EMAIL and that was that. No explanation, no discussing what went into it, no suggestions for how to improve it. In fact, when it came right down to it, our accountant hadn't even looked at the info; her assistant had typed our numbers into a software program that spit the value of our business out -- which we didn't agree with at all. And the accountant did not even attempt to help us understand it.
It was MADDENING!
We set up our process to be completely open, and to involve the client in EACH STEP so that they can see how the value is calculated. AND they can understand why we make the suggestions we do to improve the value.
The Exit Eagle establishes INFORMED PARTNERSHIPS with our clients, whether they are increasing the value or selling "as is." We take this approach with the other professionals that are involved, too -- the accountants, the attorneys, the bankers, and financial planners.
Engaging a buyer and creating a winning deal is a very sensitive process. The primary role of a Business Intermediary/ Broker is to bring all the parties along in each step of the process. If changes to the situation are withheld, and buyers feel misled, value collapses. Integrity, communication and cooperation are key to achieving a decent value for a business.
The Business Valuation is a starting point. It is not a guarantee of price.
What Exactly ARE Business Valuations?
Business valuations are one of the few subjective calculations there are in the world of finance. They are subjective because what is valuable to one person (or business) is not valuable to another. For instance, if a competitor is buying the business, in most cases, they really only want to pay for the customer list. That reduces the overall value (e.g. sell price) of the business. But somebody who is investing to have a head-start on starting a business? The customer list, the equipment, the know-how, the forms, the employees... they all have value to the buyer. And so, you get a better value -- a higher sell price.
But the highest sell price isn't always the goal; sometimes it's just getting out. Then the competitor's lower price may be more attractive to the seller because they can just get the deal done.
Where Does Quality Fit In?
Other things that make business valuations subjective are the quality of the various components of the business. Let's look, for example, at a customer list. Can you print the customer list out from one database? What all is included: Name, address, telephone, email, Instagram account, Facebook page, website address, key contact and their birth date/ anniversary etc.?
If you are a car garage and your customer list is handwritten notes in an appointment calendar, that is one value. If you are a car garage and can printout the names, addresses, and service history of the clients... that is a far different value.
The same subjectivity goes for the appearance of the business, training materials, financials....
And That's Just the Beginning
While there is a base calculation for most types of valuations – Earnings Before Interest, Taxes and Depreciation (EBITDA) – this is simply the foundation from which the strategic calculations are done. Such calculations must take into account the revenues, the debt, the future earnings capabilities, the state of the industry, the type of buyer – and the overall preparedness of the business to be run by a new owner.
There are several types of business valuations for a reason: Each type gives a different perspective on the value of your business. That’s why The Exit Eagle calculates different types for each client. We always calculate a Multiple of EBITDA valuation, based on past performance as reported on your tax returns. The second one is chosen based on the unique situation of the business at hand: In some cases, Discounted Cashflow, based on future projected performance, others Industry Comparables to see sell prices for similar businesses. Thus we are assured that the unique strengths and weaknesses of your business are taken into account, and we have considered several buyer perspectives of your business.
Most commonly used valuation methods:
Our Certified Business Valuation and Sales Prospectus involves you in every step of the process so that you understand how the values are calculated; and all the resources we tap into to get a realistic understanding of how your business is suited to tap into the industry’s future. For businesses with larger revenues, we then calculate financial ratios and Return On Investment to gain further perspective on how the buyer will look at the business. Then together we look at the range of values and agree on a realistic value expectation.
If that’s not the number you are looking for, it’s time to look at how it can be improved.