Entrepreneurship
Howard Stevenson defines Entrepreneurship as the pursuit of opportunity beyond resources controlled. Typically, we think of entrepreneurs as people who start businesses and are willing to risk loss in order to make money. In reality, an entrepreneur is anyone who spots an opportunity and decides to pursue it regardless of the resources currently at their disposal.
- Cash Flow Normalization
 Cash flow normalization is done with the intention of identifying Earnings Before Interest Taxes Depreciation and Amortization (EBITDA) or Seller’s Discretionary Earnings (SDE). These differing measures are not interchangeable, but are used by different classes of buyers for different categories of acquisition.
Free cash flow is an important measure when calculating ... - Private Equity Reputation
 We began this series by saying that Private Equity reputation is as the Great Satan to some, and a savior to others, depending on the personal experience of the speakers. In fact, both reputations are well deserved, but neither can be universally applied.
The “Great Satan” Private Equity Reputation
PEGs buy companies ... - Private Equity Leverage
 Private equity leverage can dramatically increase ROI, but it can also be a trap. In our previous article, we discussed the general structure of Private Equity, how it works, and the types of Private Equity Groups (PEGs). They have grown rapidly as an alternative investment that produces far better returns ... - Private Equity and Privately Held Businesses
 Depending on who you are talking to, Private Equity is either the Great Satan or the savior of small and mid-market companies in the United States. The stories depend a lot on the personal experience of the speakers.
Once a vehicle for high-risk investment plays in corporate takeovers (see Bryan Burrough’s ... - Addressing the Value Gap – Living Expenses
 The Value Gap is one of the most used phrases in exit planning. Simply stated, it’s the difference between what a business owner would realize if he or she sold the company today, and what they need to embark on a financially secure “next act” after business ownership.
Both amounts can ... - Owners are a Minority
 When it comes to careers, business owners are a minority of the population. In conversations this week, I mentioned the statistics several times, and each owner I was discussing it with was surprised that they had so few peers.
According to the Small Business Administration (SBA), there are over 33,000,000 businesses ... - Celebrating Mr. Fezziwig
 Since 2013 I’ve updated this piece about the underappreciated and forgotten boss of A Christmas Carol, Mr. Fezziwig. I hope that you enjoy it. Merry Christmas!
Last week was the 180th anniversary of the publication of Charles Dickens’s A Christmas Carol (December 17, 1843). The immortal words of Ebenezer Scrooge are ... - Exit Planning – Lifestyle and Legacy
 Lifestyle and Legacy are two very different types of owner transition objectives.
When we ask a client “What do you expect as a result of our exit planning?” the answer may be about the money, the time frame, or the impact on people. No matter how it is phrased, the response ... - The AI role in Exit Planning
 Is there an AI role in Exit Planning?
The media is packed with stories about Artificial Intelligence. According to the stories, because a smart search engine (which is essentially what a Learning Language Model is,) can pass a Bar exam, it threatens all kinds of white-collar careers.
And in case you ... - Delegation and Depth – Company Readiness for Exit
 Delegation and depth are critical when presenting your business as a buying opportunity. For many business owners, exit planning means getting the company ready for sale to a third party. There are a number of approaches to enhancing preparedness for a third-party sale.
Assessing Readiness
Some planning software products begin with a ...
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