The value chain that determines company sale value

Years of research has led us to create a value chain of what really creates and increases value in a company sale.

The value chain has several components that collectively increase your valuation.

First is your company’s value drivers (Company Value Drivers). These are things like the Business Model, Competitive Advantage, Proprietary Technology, and your Operating Performance.

Next is Reduction of Risk. These are items like Financial Transparency, Recurring Revenue, Customer Diversity, and Contracts with Key Players.

Then comes Growth Potential. These could be the Synergies the buyer may realize from acquiring you, or your target Market Growth, Market Position, Business Momentum, and a Realistic Growth Plan.

The next component is at the buyer level and relates to the buyer’s Financial Leverage. These will be things like Low Capital Expenditures that reduce the buyer’s out of pocket cost, the Cost of Capital in the marketplace, and the Stability of Your Business Cash Flows which helps the buyer get financing.

So, here is the punchline: Beyond your company’s earnings, there are numerous factors that could reduce your company valuation. To maximize value, leverage our time-tested techniques and intellectual property to increase your business value and gain peace of mind.

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