PREPARATION
This often begins a couple of years prior to a sale. We will analyze historical performance of the company and ensure that it supports the company’s revenue and profit projections; assist in the identification of all potential EBITDA adjustments; review and assist with refinement of critical company sales and operational information. Where there are areas that need your focus to maximize sale value in the months and years ahead, we will make specific recommendations.
VALUATION POSITIONING
Brentwood Growth will assess and advise the company about how financial performance and valuation are likely viewed by the market. We will work with management to demonstrate how the company’s core strengths represent value-add or value creation to potential acquirers. We will consider all three buyer groups (financial, strategic, and owner/operator) while considering SBA funding parameters to determine different ways a sale could be financed. We will give you a specific value range and the assumptions behind that range.
MARKETING & QUALIFYING BUYERS
We will prepare all the marketing materials, work with you to identify which of the three buyer groups (financial, strategic, and owner/operator) are appropriate, and then execute the listing strategy. Utilizing proprietary databases built through the years, offshore resources to build strategic list, and subscribed portals, we will obtain maximum exposure. We will vet and qualify potential buyers, then negotiate an appropriate term sheet. We will keep the distraction away from you and only introduce you to vetted buyers.
MANAGING DILIGENCE
We understand the importance of preserving value for your company during the due diligence process. With our extensive experience in managing buyer's due diligence, we take a proactive approach to mitigate risks and manage potential purchase price adjustments. With Brentwood Growth on your side, you can have confidence that your company's value is protected throughout the due diligence process.
Negotiating The Transaction Documents
We will work with company management and legal counsel to identify critical areas in the documents to make sure the 'deal' is not eroded by Reps and Warranties. We will ensure that the Reps and Warranties are reasonable and represent the 'market'.
Get The Transaction Closed
We will work with management, lawyers, and the buyer to achieve timely completion of transaction documents, thereby guiding management in the completion of transaction disclosure schedules. We will stay on top of the buyer during the process to drive timely execution
- Identify which groups make sense to market your business to.
- Utilize our proprietary databases we've built through the years.
- Build your company's strategic lists.
- Subscribe to portals to obtain maximum exposure and interest.
FINANCIAL BUYERS
- Consolidators backed by private equity firms
- Buying companies in various sectors that meet their profile
- Merging them into larger companies
- Improving the business for larger revenue growth, expanding service lines, improving operational and financial efficiency, supporting recruiting and retention
- After 5-7 year holding period selling consolidated platform as one large company
- Either need owner to stay to run the business, have management in place or hire management
STRATEGIC BUYERS
- Increase existing market share from existing or complementary products or services
- New markets, customers or geographical footprint
- Merge back office with existing operations achieving cost synergies
- Could operate as stand-alone or consolidate into existing operations
- Similar business in different geographic market that want to be in your geographic market or complementary business in same geographic market that want to add your services
OWNER / OPERATORS
- Individual buyer that will be active day to day management
- Will replace current owners responsibilities
- Looking for solid, consistent cash flow performance with growth potential
- Returns based on consistent cash flow to fund owner/operator compensation as well as investment in company to drive growth and valuation enhancement
- Deal Structure likely to include SBA financing and/or “Seller Financing”
- Free cash flow the business generates
- Multiple of that cash flow a buyer is willing to pay
Our team will support you throughout the process, so you can exit on your own terms. Let us help you achieve your goals.
For our purposes EBITDA and free cash flow are basically the same. It is the cash flow the business will generate to the buyer without the owner(s) associated compensation, expenses being run through the business and all one-time expenses added back.
Size of the EBITDA / cash flow
Amount of new construction and project based work
Amount of service and maintenance work
Revenue growth year over year
Marketing reputation management
Lead generation program
Size of technician crew
Business runs independent of owner involvement
About Business ValuationEither is possible. It depends on your timeline / objectives, who the buyer is and what their plans are with the business. By having a partial sale you are able to “pull some chips off the table” continue to run and grow the business then sell the remaining piece down the road with a clear exit and transition plan.
A transaction takes around 6 months to complete and the buyer will want to structure a transaction that meets your objectives. If that means work with you for several years great, if that means leave quickly then that is fine also. Whatever works for you and the buyer.
The buyer certainly needs them to stay and help run the business. In many instances the pay, benefits and potential for career advancement actually improves as they become part of a larger company.
The buying and consolidation will continue for at least several years, the current valuations paid is anyone’s guess.
We are paid a success fee at closing if and when the transaction is completed.
The range of the fee varies based upon the size of the transaction. There is no retainer or monthly support fee during the process.
We only get paid if a deal is completed.Our pricing model is based on industry accepted Double Lehman scale.
LEARN MOREYou are never locked into a commitment to the process or with us. If at any time you change your mind or are not satisfied with our performance, you can cancel the agreement and nothing is owed. Furthermore, if you are not satisfied with any offer or any buyer you are under no obligation to accept the offer.
A business broker serves as an intermediary between a business owner (the seller) and the buyer.
A sell-side business broker represents the seller and works on their behalf; a buy-side business broker represents the buyer.
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