Insights & Info

Insights > The Keys to a Successful Business Exit Today

The Keys to a Successful Business Exit Today

By Generational Equity

Keys to Successful Business Exit

I was speaking with a colleague of mine recently about deals he is working on right now and how our current turbulence has changed the deal making environment. He made a very interesting point to me about some of the keys that business owners in today’s market need to focus on:

  • Accurate Financial Recasting
  • Team Building Strategies
  • Know Your Company’s Intangible Assets
  • Flexibility in Terms of Valuation and Deal Structure

Although he pointed out that each of these is vital in any environment, right now they are critical given our current unknowns and ever-changing rules regarding COVID and their impact on businesses across the board.

The Importance of Recasting

Recasting is a critical tool, one that you absolutely need to be aware of before you show your financials to any buyers. The process is an accepted GAAP system where you remove any items from your financials that are one time, non-ongoing, business-related issues. These can range from perks for you and your family members, one-time expenses related to fire or theft, and a full range of other items that you can read about in an article we published on the topic recently.

However, you need to consider a new term relating to your financials, a twist on the old earnings model, now commonly referred to as EBITDAC (Earnings Before Interest, Taxes, Depreciation, Amortization, and COVID). Eventually, our economy will recover from this pandemic and most likely your business will return to pre-COVID revenue and earnings.

Because of this, you will need to show how the business was performing before this occurred and how it will look post-pandemic. Recasting will allow you to do this IF you document it carefully AND accurately.

Collaboration is Key

Historically, buyers always look very closely at the management of any company they are acquiring. Is there a middle-management team in place? Does the current owner make most of the decisions? If so, can anyone take over that role? How tenured are the key employees and will they stay post-acquisition?

To these topics, we can now add how did the organization evolve and adapt to the changing business conditions due to COVID? What strategic changes were implemented and how did the team react and overcome the myriad of challenges facing them?

If you can document the steps you took to survive, and even thrive, during this time via your collaboration with your team you will help alleviate buyer concerns about the longevity of the business.

Focus on Your Intangibles

Now more than ever before, as you present your company to professional buyers, be sure to focus on those areas of your business that make it unique. The list of intangible assets that buyers find of interest is very long. Your goal should be to spend some self-analysis on what makes your company successful and then document them in your teaser letter and in greater detail in your offering memorandum.

The real challenge is twofold: You are so close to your business that you may not even see the value of your intangibles AND each buyer’s view of your intangibles will vary from buyer to buyer. So, having professional exit planning advice becomes critical when presenting your opportunity to buyers.

To see more about the topic of intangible assets, please review a previous article we published on this topic.

Be Flexible!

Finally, your ability to be flexible as you speak with buyers is paramount to any transaction at any time, but never more than now. However, this is a double-edged sword, and it is why you really will need to have experienced M&A advisors by your side.

Based on our research, we believe that buyers will become ever more aggressive in looking for good deals as we come out of the economic turbulence later this year and going into 2021. However, if you are too flexible, if you give in to all their demands, you may “leave chips on the table” and ultimately NOT close an optimal deal for you.

Generational Equity deal teams are well-versed in the skill it takes to obtain satisfactory deals for our clients; transactions that protect and defend the substantial equity business owners have built into their companies. And we have done this in all economic circumstances, having closed over 900 deals over the years, creating scores of satisfied clients in the process.

We have even been closing deals since the pandemic began and doing so quite successfully. See a sampling of our recently closed transactions here:

Even during these turbulent times, buyers are very active. Due diligence may be taking much longer than before, but business owners that are ready, and that have created opportunities that are documented, are far better positioned than those that are not. Focus on these four areas as you discuss your opportunity with buyers.

If you are interested in learning more about how to exit your company for maximum value, I would suggest that you attend a Generational Equity conference in your area. These complimentary meetings are designed to help business owners navigate the exit planning process and come out on the other side in an optimal fashion.

To learn more, please use the following links:

Carl Doerksen is the Director of Corporate Development at Generational Equity.

© 2021 Generational Equity, LLC All Rights Reserved

Make an informed decision

The best decisions in life are informed decisions. We release educational business insights like this every week. Subscribe to make sure you don’t miss the latest news, views and analysis.


Success, you have been added to our list.

Thank you again for all your guidance and support. Any company will achieve what they intend, if they have you on their team!
Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
After attending a conference with GE, I decided that the value they bring would be worth the expense and as soon as I started working with them, I realized that was the right decision. When we started to get LOIs, Fred Zweifel took the lead on the communication and supported negotiations throughout the process, which got tricky as we moved forward. I learned that it can be common for companies to make a great offer then work to erode that price with their discoveries, but Fred and the GE team kept that from happening.
Caroline Connelly, CEO, OptoTest
The process was much more involved than I expected and your help, experience and advice was a big factor in making the negotiations go as smoothly as possible.
Terry D. Wickman, President, Keytroller
Thanks to you, the entire GE team and especially Michael Goss for driving a great valuation, coaching me and driving the process across the finish line. Please let me know if there is anything I can do to support GE going forward. P.S. Given my experience with GE I felt comfortable enough to sign up with Generation Wealth Advisors!
Tom Currier, Former President & CEO, Rackmount Solutions
Generational Equity educated and informed us – so that we could be on the upside of a good decision (to sell).
Bil MacLeslie, CEO, ipHouse
The professionals at Generational Equity then helped develop a roadmap for enhancing the value of the firm and an evaluation report. This was completed by June 14, 2021. We then developed the Confidential Information Memorandum and put Taylor Studios, Inc. on the market by July.
Generational Equity’s professional staff helped me every step of the way. Their network and professionals are the only reason I sold my company this quickly. For me this is a once in a lifetime sale and I was unfamiliar with the process. I was able to lean on them with questions and concerns.
Betty L. Brennan, President, Taylor Studios
Your wisdom and experience were invaluable to me during this once-in-a-lifetime transaction.
Ralph Noblin, President of Noblin & Associates
I couldn’t have asked for a better team than Michael and Deborah. We couldn’t have done it without them.
Robert Evans, President and CEO of Mealtracker Dietary Software
I wanted to write you a quick letter to express our appreciation and our delight on the outcome of helping us through the process of our recent sale. We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.
Terry D. Wickman, President, Keytroller
I decided to attend the conference and hopefully receive some guidance on how to structure an exit plan of my business. Upon arriving at the conference, I was so impressed with the presentation given by Generational Equity that I set a future appointment that week to discuss the possibility of selling my business with their Senior Managing Director David Robinson.
JoAnn Ellis, Owner of Fondren 5 Star Kennels
I must say that I have never worked with a more driven, competent and focused individual as Don Ho.
Jay Dinnison, Owner of Sharpe Mixers
Through the sale process, Generational brought in several interested buyers and we closed in about 6 months. I am so glad I accepted that invitation to the conference and could not be happier with the whole process. The team at Generational coupled with their knowledge and guidance was so valuable that in the end, I know I could never have done this on my own!
JoAnn Ellis, Owner of Fondren 5 Star Kennels
T.D., thank you so much! You are a great leader! I love how you are using your gifts and talents to better others. You are clearly a GREAT COACH! This 3 day session undoubtedly changed the future of our business, and very well may have been the sole catalyst to save my company, my health and my marriage! A genuine “thank you” from the bottom of my heart.
Bryan D. Horn, Owner, Over Under Clothing
I would like to thank you and your firm, Generational Equity, for being our valued advisors in our journey.
Bil MacLeslie, CEO, ipHouse
Greetings Mike. Thank you for the captivating and compelling presentation you made at the Phoenix presentation last week. Over many years in business yours was the most informative and well-presented presentation, on any subject, that I have ever attended! Your energy and enthusiasm combined with your concise and captivating support of your positions with easily understood examples and data was compelling.
Pete L.
We were represented by Michael Goss with Generational. The due diligence was grueling and exhausting, but Michael propped us up and kept us motivated throughout the process. Debi and I continued to ask each other how we could possibly make it through this process without the assistance of Michael. Michael's professionalism and knowledge is absolutely amazing, and we are so blessed to have had him by our side as we made our future dreams come true.
Bob and Debi Lee, Owners of BL Technology, Inc and BL Tl Services, LLC
Generational Equity’s assistance was invaluable in compiling and marketing our business.
Bil MacLeslie, CEO, ipHouse
We had the pleasure of working with Mr. Ahmad Behjati Managing Director, M&A, for Generational Equity during our acquisition of Papa's Dodge in late 2021. Generational Equity and Mr. Behjati represented and marketed Papa’s Dodge. As our primary contact, Mr. Behjati was professional in every facet of this acquisition process, conveying valuable advice most times and assisting us in every step of the process.
Rick Greene of Dobbs Equity Partners LLC
We knew it would be a difficult task to have someone really understand our business and our market, prior to researching a possible buyer, so it was imperative that we found someone of your caliber, with definite proven experience in this area.
Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
I quickly recognized that Don was working for Sharpe Mixers above all else, and held our interests above others.
Jay Dinnison, Owner of Sharpe Mixers
I am pleased that I was able to work with Andrew Byrd throughout this experience. From the first meeting we had in Minneapolis I felt that I was in good hands. His knowledge and expertise is second to none. He guided the process consistently throughout. I feel lucky that I was pared with Andrew and could not be happier that I chose Generational Equity to handle this major life event. Thank you Andrew and GenEq for everything!
Eric Erlandson, Owner, Action Fastenings, Inc.
I need to say an immense thank you to Don Ho for his stellar work ethic, attention to detail, and tireless effort. Also thank you to the whole crew at GE! Without you, Don could not do such a phenomenal job. We were shooting for closing and funding before the end of 2020, due to the uncertainty of the political landscape and taxes. I am happy to report we closed last week and will be funding tomorrow.
Dr. Caty J. Catron PhD, RN, VA-BC – Owner, Vic The Picc, LLC
The help you provided us during each step of this process made us feel very comfortable and confident we were selecting the right approach to transition our Company.
Andy Graham, Vice President, Modern Heating & Plumbing
The most important contribution I think Ahmad made was with his personality and work ethic. He is sincere, efficient, and very hard working. He was available to me at all times, whether it was for specific detail of the negotiation or just to talk through the bigger picture. He listened, advised, and recommended, but never forced his idea or opinions. In the time we worked together, he became a valued colleague and also a friend.
Salvo Stoch, Founder and CEO of Sleeping Partners
We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.
Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
We thank you Eric and Generational Equity making our dream come true.
Larry Moore, Owner, A Company Portable Restrooms
We were happy to see the interest in our company and what we cherished has not just a valuable company but an important company to the communities we served in.
Larry Moore, Owner, A Company Portable Restrooms
I wanted to take this opportunity to thank you for all that you have done for us. Not only did you take care of all the aspects of the sale but took extra care to make sure we knew what it looked like every step of the way. I will definitely recommend your company to anyone that is in a position to or looking to exit their business.
Shane and Johanna Kline, Owners of Vision Upfitters
Michael worked tirelessly, He followed every lead meticulously and urgently to make sure nothing was missed.
Robert Evans, President and CEO of Mealtracker Dietary Software