Does professional practice valuation differ from other business appraisals? Consider this: Professional practices come in many types: dental and medical practices, law and accounting firms, architecture and engineering consulting companies, individual and business professional consulting firms. While a professional practice may look like a service business, there are key differences to bear in mind that… Continue Reading
Why do you need income statement and balance sheet adjustments before valuing a company? Because the “cost-basis” accounting statements such as the company’s Income Statement and Balance Sheet require adjustments before you can use them in business valuation. Your goal here is to demonstrate the business earning power and economic value of its asset base.… Continue Reading
Small business value is driven by its earning power It will come as no surprise to you that the value of a small business depends on how much money it makes. More so than the market comparisons or the size of the business asset base, its ability to generate adequate income for its owners defines what it’s… Continue Reading
With all the business valuation methods available, you may wonder which ones work best for valuing a start-up business. First, let’s consider the special challenges faced by a young business that affect what it is worth. Conflicting requirements for start-up valuation Unlike an established business, startup companies have little history of financial performance. Frequently a young… Continue Reading
You will hear this advice time and again – if you need to get a solid business valuation, roll up your sleeves and use the Discounted Cash Flow method. Used by professionals to value businesses small and large, this income-based business valuation method has become the de facto standard for precise business valuation. When you use this powerful… Continue Reading
You may have heard that business selling price is just one part of the business purchase or sale decision. The terms of sale and business financial requirements are at least as important to a successful deal. Business acquisition financing: debt and equity Small business acquisitions are financed using some blend of debt and equity capital,… Continue Reading