A plan that gives your key employee(s) an opportunity to buy some or all of the business from you.
Most businesses today are not sellable to a strategic buyer for one simple reason: they are not valuable enough. You may want to provide an opportunity for your management team to become the owners one day. You would love to be paid a fair price for the business you have built. Your family members may be in the mix. The challenge is that they do not have the money or the ability to borrow on favorable terms, right? And you don’t want to hold a seller’s note, head off to fish in the Keys, and return to find the company burned to the ground.
We want to protect our secrets behind this strategy, so let’s just say that we know to make this work in many situations.
Here are the essential elements of the Key Employee Opportunity™:
- Set owner objectives including a timeframe for transfer of ownership.
- Project company cash flows and valuation.
- Identify the key employee group.
- Model seller and buyer net cash proceeds.
Please fill out the contact form below if you’d like to talk about creating a management buy-out plan for you and your business.