An earnout is a type of payment agreement which is sometimes used in a business acquisition. An earnout is a buyer's commitment to pay the seller a certain amount of the money tied to future performance after a sale. Under an earnout agreement, the seller receives part of the purchase price up front, and additional funds over time. The terms of the earnout are written into the sales contract.

Earnouts will probably play a bigger part of deal structure in the months ahead.  If business recovers, buyers and sellers both come out winners.

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You are the heart of American commerce. You are a small business owner. You've built your business up over time.  We recognize and applaud your achievements.  We are much like you in that nearly all of us have walked in your shoes by owning and running a company ourselves. Now you are considering letting go.   You are considering your options for selling the business.  You understand the importance of confidentiality and wonder how you can market your business without disclosing sensitive information prematurely, or disturbing the status quo.

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Small businesses often operate as if their sole purpose is to fund the owner’s lifestyle, but the most valuable companies are run with financial rigor. You may be years from wanting to sell your business, but starting to formalize the operations now will help you build the future value of your business. Then, when it comes time to approach the market and put your business up for sale, you’ll fetch more for what you’ve built. Learn how to get top dollar when selling your business.

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“Not every business will sell and a significant number never make it to market because professional, ethical advisors won't take on an engagement with little-to-no chance of success. The Q1 2019 Market Pulse Survey reveals that, on average, advisors decline about 70% of the business opportunities that come their way because the business is considered "non-saleable." 

There are any number of reasons we might decline to take a business to market,” said Lisa Riley, principal of LINK Business-Phoenix. “Unrealistic expectations, meaning sellers place too high a value on their business, is typically the number one deal killer. Declining sales trends, dated business practices, over-reliance on the owner, and significant customer concentration issues can all impact your ability to sell.” 

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Selling your business will likely be one of the biggest decisions of your business life.

No doubt you have a good idea of what your business is worth. But there are many factors to consider when putting your company on the market. Is now the best time to sell? Should I look for a cash deal or should I consider certain terms? What about confidentiality?

Working with a professional business intermediary will provide the expertise to help you make those decisions. Consider teaming with a Certified Business Intermediary (CBI), a professional who fully understands what it takes to successfully sell a business. A CBI can bring significant value to the complex process and help you complete a sale that will include the best possible value and some peace of mind.

A Certified Business Intermediary, or CBI, is the designation awarded by the International Business Brokers Association (IBBA) to members that have met certain educational requirements and ethical standards. IBBA is the largest international, non-profit association operating exclusively for the benefit of people and firms engaged in the various aspects of business brokerage and mergers and acquisitions.

A CBI is an experienced, proven professional whose claim of competence is supported and documented. With the skills necessary to handle the marketing, negotiations and complex details involved, a CBI can successfully complete the purchase or sale of your business.

To earn the CBI designation, an IBBA intermediary must meet the following requirements:

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Did you know that Texas and many other States require you to have a license to be a locksmith, but has zero requirements to call yourself a business broker? Shocking isn’t it! In the face of no State regulation, how does a business owner know if the person who offers to help sell their business knows what they are doing? Following are ten compelling and measurable reasons to use a credentialed, certified Business Broker in the sale of your business.

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Recent studies indicate that retirement continues to lead as the number one reason for selling a company. Because a business often represents up to 70% percent of the owner’s overall wealth, it is critical that they take a proactive approach when preparing for their exit. Owners who succeed in harvesting years of hard work will not only financially benefit them on a personal level, but they will have more wealth to pass on to their families.

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Perhaps you’re planning to retire, or perhaps you’ve decided to pursue a different type of business venture. You realize this is the perfect time to sell your business, and you want to ensure you’ll receive a profit that reflects the time and dedication you’ve put into your business. A strategic and perfectly executed business exit plan is of paramount importance, and it’s the cornerstone of intelligent and responsible entrepreneurship. 

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Optimism in the M&A market is at an all-time high according to findings from the Q2 2018 Market Pulse Report published by the International Business Brokers Association (IBBA), M&A Source and the Pepperdine Private Capital Market Project. 21% of business advisors surveyed say 2018 is the best year they’ve ever seen for business owners to sell their businesses. Another 37% say it’s the best time in five years, and 17% say it’s the best in the last 10 years.

Consistent with general market optimism advisors believe seller advantage is growing, with year-over- year seller-market sentiment increases in all market sectors. In the Main Street market, for businesses valued at less than $500,000, seller market sentiment is at the highest it’s been since the survey started in 2013.

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