Tag: M&A
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Why a Business Valuation is like a Health Checkup
We were recently hired to value a company. No deal.No buyer.No IPO plan. So why do it? Because the management wanted to see their business from an outsider’s perspective. A valuation without an active transaction is actually very powerful. It forces you to ask: In many cases, the number is not the most important part.…
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Why we always ask clients to group revenue sources
When we forecast a company’s performance, we don’t just apply “sales grow xx%”. Each revenue stream behaves differently. Different growth drivers.Different cost structures.Different risks. So instead of projecting total revenue as one line, we break it down: …and forecast both revenue and cost for each item, based on: This gives a much more realistic forecast…
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During a recent M&A negotiation, a client came across the term “Earnout Payments.”
In simple terms, an earnout is when a buyer pays part of the purchase price upfront (XXX) — and agrees to pay an additional amount (YYY) later only if the acquired company meets certain performance targets.These targets are often tied to EBITDA, revenue, or gross profit or Non-financial milestones — e.g. achieving a regulatory approval,…
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Thinking of buying or selling a business?
Here’s the simple version of how an M&A deal actually works. A lot of people think it’s just “meet → agree price → sign the contract.”But in reality, there’s a proper flow — 1️⃣ NDABefore sharing any sensitive info, both sides sign an NDA.Meaning: “You’ll see my secrets. Please don’t share them.” 2️⃣ MOU /…
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“Who would want to buy my business?”
This is a question that often comes up when small business owners start thinking about exit plans — especially when there’s no one to take over. But you might be surprised by how many people could be interested. For example:🔹 A listed company that’s promised shareholders they’ll grow 10% every year🔹 An investor or business…
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🔴 5 Red Flags in a Company
1. High Profit, No Cash🧾 Profit looks great, but the cash flow is missing. Could mean aggressive revenue recognition, poor collections, or rising receivables. 2. Misuse of fund – e.g. Large Loans to Directors or Related Parties💸 Money going out… but not to grow the business. This could be a sign of poor governance or…
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