In this interview, Dan Doran, explains to business owners that planning ahead is a must, and it will generate more value and return on investment in the end if planning for a sale is included in the startup of the business. While many owners are pouring money into starting the business, they do not realize an extra few thousand dollars now can lead to tens of thousands of dollars in value at the time the business sells. Mr. Doran is the Founder and Principal of Quantive Business Valuations and a seasoned valuation professional.
Key Points from our Conversation
- To fully maximize the value of your investment in a company, consider a valuation three to five years in advance of selling.
- An appraisal is a snapshot in time, so any material changes to the condition or performance of the business will change the value indicated.
- Other specific items which drive premium valuations include recurring revenue streams, defensible market niche, broad customer base, and lack of reliance on the shareholder for the performance of the business.