Blog

I haven't written A blog post in over a year it would seem. This is for a number of reasons but mostly because I've been running businesses. This is a fascinating hobby. It is also a huge challenge. I used to preach that one needs to take a step back when buying businesses. When you hand pick a manager or by a company with an effective president, you should not ...

I had an interesting conversation with an old friend the other night at a local town meeting who works for a national  business broker chain (VR).  I have dealt with them on and off over the years. They are kind of difficult to deal with because they have very small deals and their online interface is very cumbersome to work through. Anyway, I had maybe worked with my friend a ...

Here is a video that shows how real estate investments compare to businesses investments and how they are measured. One can see the big difference in typical market valuations by looking at the capitalization rates, or cap rates, which are very different between the two. Cap rates, which are used more in real estate, correspond directly with our multiples in business acquisitions ...

Here is a problem I see a lot. A first time buyer is not sure whether he should go big or small when he buys his first company. He doesn't know what he should be looking for. The first impulse is to raise capital and buy something at the $10-$20 Million level. Let's define this as a big deal although we know there are much bigger ones out there.. Now ...

This blog deals mostly with buying offline businesses, or as they call them nowadays, bricks and mortar businesses. Buying an offline business is the traditional approach with its own strategies and metrics. I teach a segment of that in the bigger markets(LBOs) but also we tackle smaller traditional deals as well.  ...

Should I start a franchised business? This is what I was asked recently. So I received a communication from my favorite online business broker today. To my surprise this had to do mostly with franchises. They were pushing a California startup Mexican restaurant franchise group. This was quite enlightening since I had just been communicating with a bunch of my students regarding franchises. In fact one of my students asked ...

Unfortunately most businesses have some kind of debt on the statement. Buyers don't always know what to do when they see it. When I say statement I mean financial statement and by that I mean balance sheet. Most companies have some sort of loans, liabilities, or other types of contingencies on the balance sheet. It comes with the territory. This is what happens when you own a business. You are ...