Buying or selling a business is probably the single largest financial transaction an individual will make in their lifetime. We strongly encourage you to engage a professional for this complicated process.

Selling...
Selling a business is a big step for most business owners.  You only get the chance to sell your business once and you need to do it right the first time.  If you are considering selling, you may want to visit our F.A.Q page or review some of the Useful Articles we have compiled.
F.A.Q.s (click here)

  • What services do Business Brokers/M&A Advisors perform?
  • How much do Advisory services usually cost?
  • Does the broker really need a one year agreement?
  • Shouldn’t I be able to cancel the contract at any time?
  • Why should I pay the broker if I find the buyer?
  • Why can’t I just sell the business myself?
  • I have an attorney/accountant why do I need a mergers & acquisition advisor?
  • I have other questions, where can I get answers?

Buying...
Buying a business is a life changing event.  It can lead a person down a path of financial and personal freedom.  Although people buy businesses for many different reasons, it always takes a significant financial and time commitment.   Utilizing an expert provides a valuable resource for the smart buyer who is looking to maximize their investment and minimize their mistakes. Call one of our members today to find out how their services can work for you.

Source: APMAA

When it comes time to sell their businesses, the first question that most owners ask is: “How much can I get?” It makes sense. Owners are eager to cash in and be rewarded for all of the hard work they have poured into their businesses over the years.

But the reality is that for many businesses, the initial valuation will be a much lower number than their owners want to see. In order to net enough from the sale (after taxes and fees) to fund the rest of their lives, most owners will have to work to boost the value of their businesses – sometimes significantly.

One great way to create value is to build recurring revenue into your business model.

The Benefits of Recurring Revenue

Recurring revenue is guaranteed revenue for some period of time (for example, through a product subscription). Because this type of revenue does not require the same level of sales and owner effort as one-time revenue, it typically results in much higher profit margins and is always highly coveted by buyers. The evidence shows us that businesses with recurring revenue models have higher valuations than those that don’t. In 2012, Adobe went from a one-time purchase model of its software to a monthly subscription model. Two years later, its market cap was $35.5B versus $16B – a 115% increase.

Examples of recurring revenue include:

  • Service or maintenance agreements
  • Consumable product or replacement part contracts
  • Subscriptions for products, services, or information
  • Memberships

Recurring revenue is stable and predictable income, and as such results in higher customer lifetime value. In addition, recurring revenue can help your business weather economic recessions and is likely to simplify your business operations in many ways.

Understanding the Value of Your Business from a Buyer’s Perspective

Companies on a growth trajectory that can demonstrate increasing cash flows through new customer acquisition, current customer retention, and increasing market share are always much more attractive to a buyer than those that have shown little growth. Buyers want to know that revenue and cash flow are growing at a steady rate and will continue to do so in the future. And a recurring revenue model can be a great way to increase the value of the business in the eyes of a potential buyer. In Cashing Out of Your Business – Your Last Great Deal, we discuss 8 key drivers of business value that owners need to focus on before selling their businesses:

  • Increasing Revenue & Profits
  • Future Growth Potential
  • Accurate Financial Statements
  • Solid Management Team
  • Quality Products & Services
  • Strong Sales & Marketing
  • Eliminating Business Risk
  • Putting Systems & Processes in Place

Adding a recurring business model is one of the best ways to address a few of these value drivers, boost profits, and enhance future growth potential — thereby increasing the value of a business in the eyes of a prospective buyer.

Even well-established businesses can usually add some kind of recurring revenue to their model and reap these rewards. It may require that owners think “outside the box” or change how they have operated historically, but it will pay off in the long term. Buyers will pay more for quality companies and those that have growth potential.

By assessing your business objectively, you will be able to identify areas for improvement so buyers will see your business in the best possible light. Planning in advance will give you time to improve your business and maximize its value. As a result, you will improve your chances of selling and obtaining the highest price for your business.

Source: Axial - By Jane Johnson, Business Transition Academy | February 2, 2017

 

Verizon's purchase of Skyward signals how the telecom giant sees drones as a key part of its fast-growing Internet of Things business unit.

Verizon said it has acquired Skyward, a startup focused on drone management.

The acquisition of Skyward, based in Portland, Oregon, will bring tools for drone operations into Verizon's Internet of Things portfolio. Verizon has been investing in IoT tools for the enterprise and its IoT business ended 2016 with nearly $1 billion in revenue.

Terms of the deal weren't disclosed. Verizon Ventures was already an investor in Skyward.

  • Skyward's technology is used for managing drone operations, bolstering safety and cutting costs. Specifically, Skyward's software offers the following:
  • Flight tracking and management of flight hours, training, licenses, and forms.
  • A system of record for flight logs, insurance policies, regulatory authorizations, and service agreements.
  • Maintenance management including scheduling, incidents, location, battery life, and firmware updates.
  • Standard processes for international operations. ZDNet

 

Gonçalo da Cunha Ferreira - Law Degree from the Portuguese Moderna University, Thames Valley University (London, academic year 1997/98), Course of Arbitration and Conciliation – ASIPI – Punta del Este, Uruguay (2005), Course on Mediation and Arbitration – ASIPI/INTA – São Paulo, Brazil (2006), Course on Mediation – ASIPI – Cartagena de las Indias, Colombia (2007), WIPO Advanced Workshop for Mediators on Intellectual Property Disputes – Geneva, Switzerland (2008) Course on Strategic Management Applied to Small and Medium Companies (INDEG/ISCTE).

Gonçalo is a Member of the Portuguese Bar Association, furtnermore of ASIPI – Interamerican Association of Intellectual Property (Member of the Arbitration and Conciliation Committee); ACPI – Portuguese Association of Intellectual Property Consultants; AIPPI – Portuguese Group of the International Association for the Protection of Intellectual Property; Founding member and member of the Board of Directors of ADPM – Association for the Defense of Product Brands; Spanish Arbitration Club ECTA – European Communities Trade Mark Association; FICPI – International Federation of Intellectual Property Attorneys; INTA – International Trademark Association; PTMG – Pharmaceutical Trade Marks Group.

Gonçalo da Cunha Ferreira joined CBA as Legal Adviser in February 2015.

Demian Esser, MBA, finance professional with extensive deal origination and execution experience having invested and advised globally on M&A and private equity transactions with total deal volumes of more than US$35bn. In-depth industry know-how in the business and consumer services, transport and logistics, infrastructure, media, leisure & tourism sectors.

Prior to founding Pedralbes Partners Demian was a Director at Citigroup’s investment bank, managing the EMEA (Europe, Middle East & Africa) transportation and services team. Prior to that Demian was a strategy management consultant with Accenture in their Products and Services practice in Berlin.

MBA from IESE Business School, Barcelona and BA Hons in International Business Studies from the European Business School, London. German/Bolivian national and fluent in English, German and Spanish.

Demian Esser joined CBA as M&A Adviser in June 2016.

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