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Accelerating the Acquisition Process

This post explains the role and importance of buy-side advisors for any entrepreneur considering a business acquisition.

Navigating Escrow and Earnest Money in Business Transactions

While both escrow and earnest money are cornerstones of a secure business transaction, they serve different purposes. We go through some key considerations in this post.

Small Business Loans for Women

Women are far less likely to benefit from the benefits of small business ownership than their male counterparts. Luckily, there are some resources available to help even the playing field and make small business ownership a reality for all entrepreneurs.

What is a Confidential Information Memorandum (CIM)?

A CIM is a comprehensive document that provides potential buyers with detailed information about the business being sold. In this blog post, we'll explore what a CIM is, why it is important, and what it typically includes.

What is a Quality of Earnings Report (QOE)?

A Quality of Earnings (QoE) report is used in due diligence to evaluate the quality of a company's earnings based on Generally Accepted Accounting Principles (GAAP). A QoE report can provide a more accurate picture of a company's financial health.

Definition of Cost of Goods Sold (COGS)

Cost of Goods Sold (COGS) is a critical metric that every business owner needs to understand. In this blog post, we explore the definition of COGS, why it matters, how to calculate it, and its impact on the financial health and sale of a small business.

How to Choose a Business Broker

Business brokers play a crucial role in helping business owners sell or acquire businesses. However, not all business brokers are created equal, and choosing the right one can make or break the success of your business sale or acquisition.

Defining & Explaining Sellers Discretionary Earnings (SDE)

If you're a small business owner, understanding your company's financial performance is essential. However, assessing your business's value is not as simple as looking at revenue or net income—that's where Seller's Discretionary Earnings (SDE) comes in.

What is the definition of EBITDA?

Understanding EBITDA is crucial for small business owners and entrepreneurs when it comes to evaluating the financial health of a business. This blog post breaks down what EBITDA is, how it's calculated, and why it's such an important business metric.

Alternatives to BizBuySell

BizBuySell is the most well-known site for sourcing small business deals, but it isn't the only option out there. We'll go through alternatives to "BBS" and where they site in the landscape of small business brokerages and listing sites.

How to Prepare a Business for a Sale

If you’re planning to sell a business soon, it's important to start preparing now. This involves taking steps to improve its financial health, streamline operations, and enhance its value to potential buyers.

Business Brokers in Austin, Texas: Pick the Best Austin Business Broker for Your Business

With an influx of younger entrepreneurs to Austin, many owners are looking for the best business broker to represent them in a sale. This post outlines business brokers in Austin and includes advice in choosing the best one for you.

How to Value a Property Management Company: A Quick Guide to Valuing Property Management Companies

Property management companies come in all types and sizes. This post lays out the best practices for valuing a property management company as well as the common questions asked.

Retirement Plans for Small Businesses: SEP vs. SIMPLE

Small business owners often face a variety of challenges when it comes to offering retirement benefits to their employees and planning for their own retirement. This post outlines the two most common retirement plans we see.

Business Brokers in Dallas, Texas: Who They Are, What They Do, and Where to Find Them

Picking a business broker is an important step in buying or selling a business. This article reviews the best business brokers in Dallas, Texas.

The [Pros and] Cons of Selling a Business to Employees

Many owners express interest in selling their business to an employee. In this post, we'll outline some pros and cons of selling a small business to a key employee.

Key Legal Documents in a Business Sale

When going through a business transaction, there are a number of legal documents that are required. This post lays out the common legal documents included in a business sale.

How to Value a Plumbing Business

Understand how to value the plumbing business you own as well as what you can to do maximize its price in a future sale.

How to Handle a Lease When Selling a Business

We've seen too many sellers and buyers invest time into a deal only for the lease to throw a wrench into things. This post outlines best practices for handling a lease when selling a business.

What Is an Add-Back?

Most businesses are valued based on their earnings. Add-backs are adjustments to the reported earnings for expenses a new buyer would not incur.

Business Brokers in Houston, Texas: Who They Are, What They Do, and Where to Find Them

Houston is the economic powerhouse of Texas, boasting over 600,000 small businesses. This post outlines the role of business brokers and lists the top business brokers in the Houston market.

How to Value an HVAC Business

Understand how the value of an HVAC business is determined in a business valuation and how to maximize the price for a future sale.

How to Transition a Business to a New Owner

Transition plans are crucial for ensuring a successful transition from one owner to the next. This post covers best practices for defining a good transition plan.

How to Handle Customer Deposits in a Business Sale

Customer deposits are prepayments for goods or services that will be delivered in the future. This post covers how these deposits are handled in a business sale.

How to Value a Construction Company

Understand how the value of a residential or commercial construction company is determined and how to maximize the price for a future sale.

What is a search fund?

Invented in 1984 by Irving Grousbeck, search funds have become a popular way for people to acquire small businesses using investor capital.

When should I start exit planning for my business?

It's never too early to start thinking about exit planning, even if you're just starting out in your business. In this article, we dive into what an exit plan is, when you should start planning and why it's important.

How to Value a Restaurant

Understand how to value a restaurant, the factors that can increase how much a restaurant is worth, and how to analyze a restaurant for sale as a buyer.

Transition Periods in a Small Business Acquisition

Almost all business acquisitions include a transition period. This post details the purpose of transition plans, their structure and compensation, and more.

Why Owners Should Reasonably Price Their Businesses

Setting an asking price for your business is a mix of art and science. In this article, we run through our best practices for pricing a small business for sale.

Buy or Sell a Houston Small Business

Houston has a well-earned reputation as the home base for massive operations in energy, aerospace, and shipping. We're dedicated to making Houston a hub of small business activity as well.

Customer Concentration in Small Business Sales

Customer concentration is a measure of how reliant a business is on a small group of customers. In this post, we’ll dig into why it matters, how to calculate it, and what to do about it.

How to Value a Cleaning Business

Understand the how the value of a residential or commercial cleaning business is calculated, the factors that impact the valuation and how to analyze the health of a cleaning business as a seller or buyer.

How to Value an Auto Repair Shop

Understand the how the value of an auto shop is calculated, the factors that impact the valuation and how to analyze the business health of a shop as a seller or buyer.

Securing a Seller Note in a Small Business Sale

Seller financing is used in a majority of small business acquisitions. However, business owners are often concerned about their recourse if the transition falls. Read on to learn how seller financing is secured in a business sale.

Working Capital in a Small Business Acquisition

Working capital allows operations to run smoothly even when there's cash coming in and out the door on different timelines. We'll help you understand all things working capital as it relates to small business acquisitions.

Should you buy a business or start from scratch?

Too many people fall victim to trying to build a rocket ship from scratch and send it to the moon. We believe the wiser approach is to buy a muscle car on Main Street.

Non-solicits: What are they and why are they important in a small business acquisition?

Non-solicits are important to understand in the context of a small business deal. This contract helps protect the goodwill value of the business being acquired.

Why You Should Keep Your Business Sale Confidential

When going through the process of selling a small business, most business owners keep the business sale confidential. We'll go through examples of why confidentiality matters and share strategies to ensure your deal is announced at the right time.

How Long Does it Take to Sell a Business?

We'll walk you through the key milestones we see across almost all small business deals and the expected timing of each phase.

10 Tips for Buying a Business in a New Industry

Thinking of purchasing a business in a new industry? This is the list for you.

Valuing the Inventory of a Business

Everything you ever wanted to know about inventory: the definition, accounting methods, common objections, and how inventory is treated in the sale of a business.

Best Practices for Announcing the Sale of a Business

Announcing the sale of a business is a critical part of the transition of ownership. If done correctly, the new owner will hit the ground running.

How to measure returns on a small business acquisition with MOIC

Multiple of invested capital (or MOIC) is a useful metric when considering the purchase of a small business. We'll go through what it is, how to calculate it, and how to use MOIC when conducting due diligence.

How to Determine What Size Business You Can Buy

Unlike the real estate market, the market for buying a business can be confusing and opaque. We outline the main considerations for estimating the size of the business you can buy.

Why Employee Tenure Matters

Employee tenure is a metric that speaks to the institutional knowledge within an organization as well as the likelihood to retain that knowledge in the advent of a sale. We'll run through what buyers want to see when it comes to talent.

Do's and Don'ts for Buyer Meetings

As most acquirers of small businesses plan to own and operate the businesses, the owner meeting is a large factor in whether a buyer decides to submit an offer.

What an SBA Loan means for Seller Financing

SBA loans and seller notes are almost always used in conjunction. We'll break down the different types of Main Street financing and how they relate to each other in the purchase of a business.

Why do Business Owners Use a Business Broker to Sell to an Employee?

We’ve spoken with a number of owners who consider an employee transfer and decide to do a competitive sale process instead. This begs the question, why work with a broker if you’re considering selling to an employee?

Debt-service coverage ratios and why they matter to your business sale

We demystify debt-service coverage ratios so you understand how lenders think about the metric and what that means to you as a buyer.

Owner's Draws: What they are and how they impact the value of a business

Everything you need to know about owner's draws. What they are, how they compare to other forms of compensation, and how they impact the valuation of a business.

Buying a Franchise vs. an Independent Business

Franchises are a great option if you want to de-risk as a small business owner. However, it's also important to consider an alternative option: buying an independent small business.

Installment Sale vs. Seller Financing In A Business Sale

Installment sale vs seller financing compared, the similarities and differences between seller financing and an installment sell, the benefits of an installment sale and seller financing to business sellers.

The Business Installment Sale Process: What’s In It For Business Sellers

How to sell a business through an installment sale, the pros and cons of installment payments, the tax implications of an installment sale.

Earnouts in a Business Sale

Earnouts are an option for closing a sale, ensuring future payments to the seller when a buyer may not have the full purchase amount at the time of sale.

Assumed & Excluded Liabilities in an Asset Purchase

Buying a business’s assets does not mean you become responsible for the selling companies liabilities. There are, however, important exceptions you need to know before you proceed with the transaction.

Why You Need a Business Sale Escrow When Closing Deals

What business sale escrow entails, how the escrow process works during a business sale, why you should consider escrow for your business sale, where to get business sale escrow services.

Pros and Cons of Rollover Equity in a Business Sale

Rollover equity is what business sellers will sometimes use to stay involved post-sale, requiring sellers to remain invested in the company via equity shares.

Considerations When Selling a Business as a Going Concern

There are specific accounting rules that govern the definition of a business as a "going concern." Understanding the implications of a business sale as a going concern can keep you and your potential buyers on the same page.

What a Non-Compete Covenant Means For Your Business Sale

What a non-compete covenant entails, what to expect from non-compete agreements, and the factors that business sellers should prioritize when negotiating non-compete clauses.

5 Types of Business Buyers Who Might Buy A Business

Who are business buyers? Understanding the different types of business buyers you might encounter as you try to sell your small business or franchise can help you find a buyer quickly for as high of a price as possible.

An Interview with Craig Thompson, Co-Founder of Consolidata

We sat down with Craig Thompson to discuss the importance of due diligence, quality of earnings, and forecasting for prospective owners as well as exit planners.

How To Value a Landscaping Business

Understand the steps you should take before you start buying or selling a landscaping business in order to maximize your valuation (as a seller) or avoid overpaying (as a buyer).

An Interview with TJ Brogan, Owner of Washaroo Hand Car Wash

We sat down with TJ Brogan to discuss the process of buying and running car washes in Austin, Texas. TJ shared the origin story of Washaroo, some key learnings from his first months on the job, and advice he’d give to other young entrepreneurs.

Using a 401(k) to Buy a Business

You can partially or wholly fund your business purchase by executing a 401k Rollover as Business Start-up (ROBS). But that’s not the only way to leverage a 401k to buy a business.

A Guide To Selling A Business To Your Key Employees

Learn about the different deal structures that exist before deciding on what exit strategy you'll use to sell your business to key employees.

Comprehensive Buying A Business Checklist: Due Diligence and More

From business selection to due diligence to negotiating, make sure you are checking all the boxes as you go on your journey of buying an existing business.

Common Mistakes People Make When Selling a Business Online

Selling online can help you minimize broker fees and find the best buyer for your business. But depending on where you sell, you might be setting yourself for more work and a worse outcome.

How To Minimize Capital Gains Tax On Your Business Sale

Tax rates on small business sales can be brutal. Consider offsetting your capital gain with reinvestment or other tax deferral strategies.

The 10 Steps To Buying A Business

From identifying what you want in a business to maintaining your new business, there are many steps to take in the process of buying a business. Make sure you don’t miss any important ones along the way.

An Interview with Chris Truglio, Co-Founder and COO at Stress-Free Auto Care

We sat down with Chris Truglio to learn more about the process of buying, owning, and operating auto repair shops. We discussed everything from how to perform effective due diligence to the intangible indicators of successful shops.

4 Differences Between Asset Sale vs. Stock Sale

As a seller, you should understand what is an asset sale vs. a stock sale to maximize the financial benefits for yourself in the sale.

How To Find a Business Broker as a Buyer

Finding a business to buy can be hard. Having the expert help of a broker can help you make the right decision if you choose the right one.

Seller Notes In Financing A Business For Sale

Commonly used in small business acquisitions, a seller promissory note enables the seller to provide a loan to the buyer.

4 Places To Find Qualified Buyers For Your Business

There are many people out there looking to buy small businesses. Read about listing websites and other strategies for finding them.

5 Ways to Find Businesses for Sale

Business-for-sale listing websites aren't the only place where you can find businesses for sale. Besides the slew of listing websites, you can try brokers, the owners directly, and more.

A Seller’s Guide to Small Business Valuation

Conducting a business valuation is a valuable exercise at any stage in the small business lifecycle. If you are thinking of selling your business, conducting a fair market valuation can help you understand what a buyer is likely willing to pay.

Seller Financing: Why is it required? What are the common terms?

Seller financing is almost always part of small business acquisitions. Understand why that is as well as the common terms associated with it.

Business Broker Fees: How Much Are They, And Who Pays?

When you want to sell or buy your business, you want the best value possible. As a seller, you want the highest selling price, and as a buyer, you look for the lowest price. Business brokers help you achieve the best value possible.

How To Use An SBA Loan To Buy A Business

SBA loans can help you finance acquiring an existing business or franchise if you meet the SBA requirements.

The Tax Consequences Of Buying A Business To Consider

When buying a business, many factors may influence your deductions and taxes owed: asset sales vs. stock sales, S Corps vs. LLC's, and more.

An Interview with Jake Parsley, Attorney at Parsley Law

We sat down with Jake Parsley to hear about business transactions from a legal perspective. We discussed the role of attorneys, the key legal documents owners should have, and the differences between asset sales and stock sales.

A Survey of Business-for-sale Sites

Starting with BizBuySell in the mid 90s, there has been an explosion of business-for-sale websites. This article surveys the options out there based on their functionality, number of listings, price and monthly traffic.

An Interview with Max Friar, Co-Founder of Small Business Deal Advisors

We sat down with Max Friar to hear about his journey into business brokering, how he's introduced technology into a relationships business, and what makes a business broker great.

Reverse due diligence

In small business acquisitions, preparation is key but often forgotten. Reverse due diligence is one of the most helpful things a business owner can do before listing her business for sale.

An Interview with Sal Acosta, Managing Partner of Landon and Acosta

We sat down with Sal Acosta to hear about his process for qualifying buyers and sellers, where he thinks the brokerage industry is going, and some common misconceptions about selling a small business.

9 Questions to Ask a Business Broker

Working with a business broker is a great option for many business owners, but not all business brokers are created equal. This post covers the key questions to ask a broker before signing an engagement agreement.

An Interview with Morgan Tate, Co-Founder of Paratus and Advisor at Chinook M&A

We sat down with Morgan Tate to hear about his journey into business brokering, his thoughts on seller education, and how COVID has affected the market for sellers and buyers of small businesses.

The Role of Community Development Financial Institutions

When looking for small business loans, owners may come across Community Development Financial Institutions (CDFIs). These institutions are dedicated to helping increase access to financing in underserved communities.

The Benefits of Selling to an Employee

Among the exit options a small business owner has, selling to an employee stands out in terms of its advantages. This article dives into three key ones: price transparency, ensuring stability, and experience.

The Business Broker Landscape

Business brokers have formed a crucial part of the SMB ecosystem for decades. They’ve served the role of educator, negotiator, and shepherd to hundreds of thousands of business sellers and buyers.

Mainstay

Mainstay is Beacon's new publication. We'll be covering everything to do with main street businesses: from getting started to operating best practices to planning for exits.

Understanding Seller's Discretionary Earnings

A common metric used to value small businesses is seller’s discretionary earnings, often abbreviated as SDE. This metric is a calculation of how much cashflow a business generates.