Business Value: How To Know How Much Your Business Is Worth
In this episode, John continues his series on the Wealth Curve Blueprint, with special attention to business owners. This time he discusses the business valuation and how it can help increase the value of your business.
John is the author of 5 Ways Your Wealth is Under Attack. He has lectured at various educational institutions such as John Hopkins, Haas School of Business, UC Berkeley and UNC Chapel Hill. He has consecutively received the Five StarSM Wealth Manager Award since 2011, and is the former president and chairman of the Rotary Club of Red Bank Foundation.
Don’t miss John’s key points:
- Most businesses are not sold for anywhere near their fair market value.
- Ultimately, your business is worth what somebody’s willing to pay for it: strategic acquisition, being in the right field at the right time, or a strategic opportunity for a competitor.
- It’s vital to understand the value of your business and how you can make it even more valuable.
- Don’t assume you know your business’s value.
- Our Business Valuation (part of the Wealth Curve Blueprint) takes into account equity value, asset sale, enterprise value, and liquidation value.
- We find the key performance indicators that drive your business. We focus on ways to improve the success of those indicators in order to leverage the value of your business.
- We’ll also ask: Do you have the right buy-sell agreement? Is your business protected properly? Do you have the right successor in management if something were to happen to you? Answering those questions will help you make better decisions. When you make better decisions, they’re usually followed by more wealth.
A regular review and a regular update of your business valuation is such an important part of your financial plan. If you don’t know what your business is worth, how do you know if you’re going in the right direction? How do you know that you’re going to end up where you want to be?
For details, listen above. For more information about this or any other aspect of wealth planning, talk to us.
If you are new to Smallwood Wealth schedule a Wealth Curve Conversation here.
You can also call all us at (800) 797-1000.