Prospective and actual investors in small and medium businesses seek five things that pique their interest enough to pursue initial or follow-on investment. This includes a base business valuation and a strong management team. This article provides an overview of each of the 5 key elements. 1. A strong return on investment. Ranges from 8% … Read more
Valuation How does one value a company? While at a broad level one may be able to understand why a company may be worth a certain amount to an investor or a buyer, it is not always possible to understand why someone is willing to pay a certain amount for a business. A business worth … Read more
If your business is one of the many businesses that needs additional equity capital, then you have a basic choice: do you seek the expertise and capital of a financial or strategic investor? The two have very different implications. Financial investors, broadly defined, include venture capital funds (for start-ups or companies early into their life … Read more
When firms look for maximizing their value, they compare their performance with that of other firms in the same industry and evaluate the trends of the firm’s financial position over time. Financial statement analysis helps managers predict future earnings, dividends and free cash flow. Analysts use financial ratios to derive important information about the relationships … Read more
BUSINESS VALUATION Business valuation is a process and a set of procedures used to determine the economic value of an owner’s interest in a business. Business valuation is often used to estimate the selling price of a business, resolve disputes related to estate and gift taxation, divorce litigation, allocate business purchase price among the business … Read more