Acq 6: Introduction

“Money flows in the direction of value.”

– Uche Ugo, International Brand Consultant

Valuing a business is an inherently difficult undertaking, but it’s a critical step in planning the sale of your company. In this chapter, I explore why that’s the case and why the ranges of potential values for businesses are much wider than for other assets. You’re about to gain a greater understanding of the challenges you may face when valuing your business and learn what factors can affect the potential range of values for your company.

The essence of valuing a business is predicting its future cash flows and then placing a price tag on those cash flows based on their present value.