Business Succession & Exit Planning Solutions

Exit, Succession, and Retention Planning

70%-80% of Businesses Fail to Sell
Are You Prepared?

Working with a CEPA is one of the few ways to achieve a better outcome, but many business owners come to the table far too late.

Our team provides you with creative solutions through a number of advanced strategies that can be custom-tailored to meet your specific needs. 

business owner

All Businesses Benefit from Planning

  • Business Exit Planning
  • Business Succession Planning
  • Executive Bonus Plans
  • Key Person Strategies
  • Non-Qualified Deferred Compensation
  • Simplified Employee Pensions (SEP)
Why Businesses Fail to Sell

You're Poorly Positioned to Sell-And the Potential Profit Is Too Low

When owners decide to exit, they realize they haven't allowed themselves enough time to position their businesses for transition, minimize taxes, or maximize net proceeds. They end up with significantly lower net proceeds.

CEPAs have been known to help their clients increase profits on a sale by significantly above the original valuation.

Life Happens-And You're Unprepared

Many owners are unprepared when an unplanned event affects them and forces them into an exit that's not on their terms or timeline.

Even worse, sometimes owners receive an unsolicited offer from a buyer, but their lack of readiness prevents them from harvesting the full value of their business.

Examples of some unplanned events may include death, disability, disagreement with partners, or divorce.

You Can't Pass the Due Diligence Test

When the time comes, many owners just can't sell. Private equity and strategic buyers are seasoned and selective. You might be unable to complete a sale (or even a partial sale) of the business to a third party because the business is unable to pass the due diligence test.

Your Business Is Too Risky to Sell

Many business owners eliminate their inside options, including transitioning to a family member, employees, or partners because the business can't operate without the owner and is potentially undercapitalized, has insufficient cash flow, or has too much risk to succeed with an inside option.

Helping You Increase Business Value and Efficiency

We use the Value Acceleration Model to help you increase the value of your business. It's a proven methodology that reduces risk, increases value, and positions your business to be more profitable, more efficient, and more scalable.

The Exit Checklist

A 5-Step Personal Action Plan For A Happy (And Lucrative) Exit From Your Business

1. Get Clear on Why You're Exiting

Why do you want to exit your business?

In most cases, there are a combination of factors that are either "pushing" you away from your business or "pulling" you to something else.

2. Align Your Exit Type with the Reason You're Leaving

Often, when we think about exiting a company, we conjure the image of a spectacular business sale where a strategic buyer swoops in, pays an enormous price, and the business owner rides off into the sunset.

The reality is that there are several different ways to exit the day-to-day operations of your business, and the smartest founders align their exit type with their reason for leaving.

3. Figure Out Your Number

The ultimate judge of your company's value is the market itself. No matter how much you want for your company - or what you think you need - if the market says the business is not worth that, then you're out of luck.

In addition to getting a business valuation to understand what your company might be worth to a third party, there is another calculation you should make, which is to understand what your business is worth to you.

4. Decide What Role You Want to Play in Your Company in the Future

For most owners considering exiting their business, they imagine an all-cash offer and leaving their company shortly after depositing the check. However, most exits are more gradual and rely on the owner's continued involvement after the sale.

It's important to get clear on the maximum amount of both time and money you're willing to commit after a transaction. As a general rule, you stand to earn more money from the sale of your business the more willing you are to participate in a transition period.

5. Pick Your Spot on the Exit Matrix

At one extreme, you may have built up enough investable assets outside of your business to be financially secure, and you are willing to continue to be a shareholder in your company for the long run. If this is you, then hiring a CEO and relinquishing your day-to-day responsibilities may be your best exit option.

At the other end of the spectrum, you may have another business you want to start immediately and therefore want to maximize your cash proceeds and minimize your time in your company post sale.

In this scenario, you would look to sell your business outright to a strategic buyer. No one point on the Exit Matrix is better or worse than the other. The key to a happy and lucrative exit is to get clear on your priorities before you start the exit process.

The Exit Matrix

Your final step to a happy and lucrative business exit is to pick your spot on the Exit Matrix, which corresponds with two factors:

  1. How important is it that you maximize the cash proceeds
    of a sale?
  2. How long are you willing to stay on post sale?
exit-matrix

Working with a CEPA gives you a better business whether you sell or not. Who Do You Have in Your Corner?

Who do you have in your corner helping you navigate all the pitfalls of selling a business?

So many business owners try to go it alone. When they don't fail outright (and so many do), they often get significantly less money than they hoped for.

Your CEPA knows where the problem areas lie for most business owners and can help you identify your business' weaknesses, strengths, and how to make the most out of both.

Deep Education

In addition to completing a 4-hour proctored examination, CEPAs must complete a comprehensive master's level 5-day course from the Certified Exit Planning Institute. Every 3 years, CEPAs must complete a minimum of 40 hours of continuing education.

Your Business Is Too Risky to Sell

Many business owners eliminate their inside options, including transitioning to a family member, employees, or partners because the business can't operate without the owner and is potentially undercapitalized, has insufficient cash flow, or has too much risk to succeed with an inside option.

Business Exit Planning

Do you know how you are going to exit your business? You may have a dream of going public, selling to the highest bidder, or retiring and handing over your business legacy to your family.

Big dreams aside, the truth is that many small business owners have no exit strategy for their businesses in the event of their disability, retirement, or death. Given the current economy, it isn’t surprising small business owners focus their energies on business survival, future growth, and even remaining active in business after retirement. However, a business exit strategy not only means having a plan for the unexpected – including financial hardship, injury, disability and even death – it also means having a plan for the succession or transfer of ownership of your business when it comes time to hang up your hat and retire.

Develop a Succession Plan

There is no “one plan fits all” when it comes to developing a succession plan for your business. But following SCORE’s recommended five steps to succession planning (including choosing and training a successor) can help provide some practical direction and deliver the peace of mind that comes from knowing that your life’s achievement is in good hands. 

All businesses can benefit from buy-sell planning.

  • It provides a definite market for transferring the ownership interest.
  • It specifies a set or determinable price.
  • It may provide some or all of the funds necessary to execute the agreement.
  • It maintains “closeness” of the business by restricting and planning who/what can receive the business interests.
  • It may provide liquidity to pay estate taxes (due 9 months from date of death.)

The Process of Exiting Your Business

Whether you are selling your business, transferring ownership, seeking retirement, or facing a “forced-exit” such as bankruptcy or liquidation – planning your exit is a big undertaking that has implications on employees, your business structure, its assets, and your tax obligation. Before you embark on your exit strategy, be sure to engage your lawyer and even a business evaluation expert. That way, you will be sure that you have explored all the options available to you.

TCFG Exit Planning Senior Consultant
TCFG Exit Planning Senior Consultant
CEO & President Mobius Financial Advisors
Ray is CEO and President of Mobius Financial Advisors. Before entering the Financial Services profession, he owned his own business with numerous employees, equipment, and real estate for over 15 years. Combining this invaluable experience with his financial knowledge and education makes him well suited to work with business owners and their families.

Background

  • B.B.A. Financial Services, University of North Texas
  • B.B.A. Insurance, University of North Texas
  • Certified Exit Planning Advisor
  • Certified Value Growth Advisor ( CVGA)
  • International Association of Registered Financial Consultants
  • Chartered Life Underwriter-American College
  • Chartered Financial Consultant-American College
  • National Association of Insurance and Financial Advisors
  • Society of Financial Service Professionals
  • Adjunct Professor, University of North Texas

Community involvements:

  • United Way Denton County - Board member
  • Rotary
  • Exit Planning International - Chapter President
  • Global Atlantic- National Advisory Board
  • Value Builder - International Advisory Board
  • EPI- National OEM Board
  • Access Bank- Business Development Advisory Board

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