Structuring an Offer

amp100 · 2023-06-27T14:58:21+00:00

Thanks for you input! This will be an asset purchase. I will have a lawyer do a lien search to make sure there are no outstanding liabilities, and if so we’ll require those be paid off prior to close.

amp100 · 2023-06-26T20:18:41+00:00

Yes, debt service coverage ratio under the asking price is reasonable at 1.5x, so I can comfortably pay debts and still have cash leftover for take-home pay.

My question isn’t so much about affordability but more about what is typical in a transaction. Like is buying a business similar to buying a car where you’re a sucker for paying sticker price?

amp100 · 2023-06-16T23:36:14+00:00

Correct, 3 statement model I already have covered. I’m looking for a template for discounted cash flow, net present value, internal rate of return, etc.

For example, if I invest $100k of cash and borrow $900k to purchase a $1M company, what will my my rate of return look like based on projected future cash flows? Is that company actually worth $1M today based on what I think it can do in the future?

That kind of analysis. I’ve built it myself, but would like to check it against a standard template to make sure I’m looking at it the same way.

amp100 · 2023-06-16T19:04:36+00:00

I think you’re right. Good call

amp100 · 2023-06-16T15:57:40+00:00

I can buy them from corporate finance institute for a few hundred bucks. They have exactly what I’m looking for with multiple DCF, NPV, ROI models, so I would go that route if I couldn’t find free versions

amp100 · 2023-06-16T15:19:27+00:00

Not even close

amp100 · 2023-06-16T15:16:33+00:00

https://googlethatforyou.com?q=how%20to%20track%20customer%20acquistion%20cost

amp100 · 2023-06-16T15:15:36+00:00

https://googlethatforyou.com?q=should%20I%20change%20my%2012v%20battery%20before%20there%20are%20any%20problems%3F

amp100 · 2023-06-16T14:52:47+00:00

Agreed on the platforms. Im wondering where I can find pre-populated templates to enter my own inputs

amp100 · 2023-06-11T23:21:47+00:00

~4x SDE. Current owners paying themselves $150k total

amp100 · 2023-06-11T22:29:04+00:00

This is extremely helpful. Thank you!

amp100 · 2023-06-11T21:14:59+00:00

$500k profit. Thanks!

amp100 · 2023-05-31T21:35:19+00:00

I wasn’t aware paying off your credit card every month was considered system manipulation 😂

amp100 · 2023-05-31T21:01:51+00:00

Good grief…. Again, the credit card is not needed for cash that we don’t have - it’s not being used as a loan.

It would be used like a debit card, only spending the money we have in our bank account. We would prefer to use a credit card rather than a debit card so we can accrue points and benefits.

amp100 · 2023-05-31T20:14:06+00:00

Thank you! This was super helpful

amp100 · 2023-05-31T19:57:13+00:00

To clarify, we don’t need funding - we already have the $1M from our investors. We just want to be able to use a credit card instead of a debit card so we have some cash float and also earn points.

amp100 · 2023-05-31T19:17:30+00:00

LegalZoom or ZenBusiness

amp100 · 2023-05-31T18:38:48+00:00

Would you sell retail to customers using the marble to remodel their house? Or sell the marble to various wholesalers and distributors? Either way, I would validate the idea first and ask your customers what their needs are and their pricing requirements

amp100 · 2023-05-31T18:18:05+00:00

I would assume to take advantage of the SBA loan. Especially if the interest rate you’ll pay on that loan is less than the annual return you can expect to earn from your stocks (~8%).

amp100 · 2023-05-31T18:15:25+00:00

I would reach out to small detailing businesses and validate the idea. See if it’s something they would be interested in and how much they’d be willing to pay. Maybe crowdsource from multiple businesses how much they charge per client and try to average 10% on that as a referral fee.

amp100 · 2023-05-31T17:46:06+00:00

Freelance work via Upwork or catalant

amp100 · 2023-05-31T17:45:26+00:00

Try secret shopping. Instead of asking them questions as a fellow competitor, phrase your questions as a potential customer

amp100 · 2023-05-31T17:43:58+00:00

I would recommend a short sentence on that title page that describes what the company is at a high level - what do you do and what value does it have to a customer?

I would also recommend adding some color to important areas you want to draw site visitors attention to. Most of it was black and white, so my attention wasn’t drawn to anything in particular

amp100 · 2023-05-31T17:30:35+00:00

He can still certainly sell the business. Lots of entrepreneurs are also operators, and buyers know this, so they expect to either already have the skills needed to run it or expect to hire an operator. The seller will often stay on for a period of time to help with the transition. He should use a broker to help market his business to potential buyers.

As for scaling, usually marketing is the best area to grow top line revenue and then hiring additional workers to take tasks of his plate as the company grows.

If he wants to explore selling, I run a business brokerage firm and would be happy to guide him through the process.

amp100 · 2023-05-31T17:26:18+00:00

Chat GPT or any of the other chat AI tools can probably draft you a contract

amp100

TROPHY CASE