Name: Tim McDaniel, CPA/ABV, ASA, CBA, Principal, Director of Business Valuation Services
Posts by Tim McDaniel, CPA/ABV, ASA, CBA, Principal, Director of Business Valuation Services:
You’re busy serving customers. Managing employees. Overseeing the day-to-day operations of your business. Stepping down as the head of your company may not be on your radar, but sooner or later you’ll need to think about what will happen to your business once you’re out of the picture. We recommend that business owners start thinking about their business succession plan at least five years before planning to implement it. Read the rest of this entry “
If you’re a business owner, did you know that you can significantly increase your net wealth by simply changing the way you look at your business? Read the rest of this entry “
Whether you’re embroiled in litigation as a Plaintiff or Defendant, or whether the case is related to divorce, injury or breach of contract, the actual cost of litigation can be quite staggering. And while we immediately think of the economic costs associated with attorney fees, insurance premiums and damages, it is imperative that you consider the emotional costs as well.
Whether you’re negotiating a divorce settlement or your company is for sale, the value of your company is critically important. And while there are times that you’re happy with a relatively low value, there are certainly situations when you might ask, “but what about Facebook?”
Facebook is the world’s largest social network, with more than 900 million users. In a highly anticipated and followed Initial Public Offering (IPO) in 2012, Facebook’s implied company valuation approximated $100 billion, making it one of the largest in the history of technology stocks.
But for an industry that prides itself on fundamentals, what did Wall Street anticipate when Facebook opened up at $38 per share? The $38 per share price implied that Facebook was worth 89 times its historical earnings and 76 times its projected earnings, according to Barron’s online. Contrasted with established companies such as Google (14 times projected earnings), Apple (11 times projected earnings) and the NASDAQ and S&P 500 (11 – 15 times earnings), was Facebook valued properly or was it simply a case of irrational exuberance? Read the rest of this entry “
Last year, I was consulting with a client who owned a business that was worth over $20.0 million. He said that one of his advisers told him “Why waste your time and money developing an exit and succession plan? You will be dead and won’t care and let others take care of it after you die.”
I guess that’s a good plan – if you don’t mind the chaos it creates for your family members and if your legacy is not important to you. Read the rest of this entry “
Exit strategies are the options that you have to leave your business. There are only a few exit strategies that Ohio business owners can choose from and each will provide you with a different level of proceeds when you leave. All strategies will require planning and time to implement.
It’s never too soon to start planning your exit. You will eventually leave your business, and it’s better to do so before a life-changing event forces you out. The sooner you plan, the more options you will have. Read the rest of this entry “
One of the most basic individual investment principals is the concept of diversification. As an investor, diversification can protect you from a large drop in your portfolio due to the poor performance of any one investment.
If you own a business, the business value is most likely more than half of their entire net worth. You cannot simply call your investment advisor and quickly sell a part of your business to diversify. It is possible to sell a partial interest in a business, but this is not available to all business owners and requires significant amount of planning.
So, what can you do to protect your net worth from dropping from a large decrease in the value of your business? Read the rest of this entry “
2012 Gift Tax Exemptions and Business Planning
As you go about your day-to-day work within your business, you might not be thinking about what will happen when it’s time for you to leave the company. However, recent changes in the gift tax laws have created a window of opportunity that could allow you to transfer more of your business interests for less tax liability than at any other time in history. Read the rest of this entry “
You’ve worked hard to build your business and probably can’t imagine a time when it won’t be a major part of your life. But, someday, you’ll approach retirement and you’ll want to spend more time enjoying your life and less time balancing your books.
Maybe you’ll want to leave your business to your daughter. Maybe you’ll want to sell it and cash out. Either way, business transition doesn’t just happen. It isn’t serendipitous. You need a “get out of business” or succession plan. Read the rest of this entry “
About 25 percent of businesses fail within the first year, according to Small Business Trends. Only 44 percent survive for four years. What if your business doesn’t make it?
If you don’t have a buy-sell agreement, things could get hairy. Or if you developed one in haste and never update it, the buy-out probably won’t be fair to all parties. The hassles from litigation that result from faulty buy-sell agreements could last for years and negatively impact your business. Read the rest of this entry “