Selling to a Competitor

When you put your business up for sale, you’re bound to attract interest from your competition.

It makes perfect sense. They have a variety of legitimate reasons to be interested in your company. They may be hoping to benefit from your technology, your patents, your employees, your contracts, your existing market share. When they’re on the up-and-up, your competitors absolutely deserve consideration as potential buyers.

However, there’s a risk that they’re not genuinely considering a purchase, but actually using your “for sale” sign as a spying opportunity. We’ve all been “looky-loos” at some time in our lives: popping into a neighborhood open house or test-driving a dream car. However, when your business is the product and the competition wants to metaphorically open the closets and inspect the basement, you need to make sure that they’re seriously considering the purchase, and that you don’t share privileged information with them until the deal is signed.

Worst case scenario: Your hot prospect competitive buyer was only pretending interest, and they succeed in accessing information which makes them an even stronger competitor. Worse yet, if they successfully act on their new intelligence quickly, that might further hinder your ability to sell and command the price your deserve.

However, since part of the diligence and buying process involves the sharing of potentially sensitive data, stonewalling your buyer shouldn’t be your go-to response. Treading carefully is essential. Here are some questions to consider.

Do you even want your competition to know that you are trying to sell?

This question represents the ultimate balancing act. There are plenty of strategic reasons to keep your intention to sell on the down low, especially in regards to your competition. In fact, unless they are good buying candidates, your business is probably better off if they don’t know. Make a list of your competitors and try to understand whether they’d consider buying your business a welcome opportunity. Use your insider knowledge to try to determine what they’d value most about acquiring you, and what they’d value least. Also, consider your existing relationship with them. If you’ve got a courteous relationship of mutual respect, there may be more reason to trust them. If things have been ugly in the past, don’t expect them to get better in the course of acquisition negotiations.

How Can You Assess Whether They’re Legitimately Interested or Simply on a Fishing Expedition?

Consider their track record. If they’ve got a recent history of acquisitions, their interest is more likely to be legitimate. If this is their first apparent foray into acquisitions, they might have darker motives. Similarly, a genuine buyer is likely to have a team or specialist devoted to M&A. If they don’t, that’s another potential red flag.

How Can You Share Enough of the Right Information, Without Putting Your Business at Risk?

Here’s what Barbara Findlay Schenck wrote in Selling Your Business For Dummies:

If you feel a competitor is truly serious, treat it as a hot prospect but proceed carefully. First, be sure to obtain a mutual confidentiality agreement. Then request buyer background information before sharing further information on your business. This information exchange allows you to determine whether the competing individual or business has the capability to purchase your business and it also provides a good test of the competitor’s motivations. A competitor who’s simply fishing for information about your business won’t be interested in sharing confidential personal or business information and that alone will provide the answer to your question about how to rate the validity of the inquiry.

A Competitor Can Be a Great Buyer

Your competition can be a rich source for strong buying candidates. They may be willing to pay top dollar for a strategic acquisition, and the possibility of eliminating competition could be very attractive to them. A competitor may realize they can acquire you and eliminate many of your fixed costs thanks to an economy of scale, which means your business is worth more to them than to a non-competitor. However, the risks are considerable, so we urge caution. Evaluate them carefully and make sure you’re getting good advice from your own resources as you explore the prospect.

Do you have questions about buying a business or selling a business, give us a call?  We’re happy to help! We can be reached at 612.331.8392 or by email at info@oibmn.com.

Meet our team: http://oibmn.com/our-associates/

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Confidentiality: How to Maintain it During a Business Sale

How can a broker help you maintain confidentiality in a business sale? 

When you decide you’re ready to sell your business you may have concerns about keeping the sale on the down low. If word about the sale gets out among creditors, customers, employees, competitors or vendors, it could trigger a host of negative reactions and unrest and could potentially decrease the value of your business at a time when maintaining its value is a top priority. The most secure way to navigate the sale of your business is to enlist a broker. Brokers have a number of systems in place to safeguard the confidentiality of your transaction.

Using Teaser Descriptions to Market Your Business

When advertising your business for sale, a broker will create a “teaser description” of your business. This description will contain enough information to pique the interest of potential buyers without revealing the identity of your business.

Pursuing Buyer’s Qualifications

After reading your teaser description, when a company or an individual express interest in moving forward in the purchasing process, the next step is to pursue buyer qualification. This means requesting financial information that demonstrates the potential buyer’s ability to secure the purchase of your business. Fortunately, your broker will navigate these waters for you. If the interested party is unable to provide a proof of funds then you are out nothing and the identity of your business is still under wraps. However, if the interested party demonstrates purchasing capability, you can confidently move forward in the process by entering into a confidentiality agreement. 

Using a Confidentiality Agreement

A confidentiality agreement is a document your broker will have on hand. Once you determine that the interested party is financially-qualified, they will sign the agreement. This signed agreement protects your business if they break confidentiality and it serves as a portal through which you can divulge your business name and other private company information.

Maintaining Open Communication

Throughout this time, your broker will encourage you to maintain open communication with your management team. They will also orchestrate meetings that include your upper-level management. Keeping upper-level management in the know will give them time to mentally prepare for this transition and it will demonstrate that you value them and recognize the value they contribute to your business. It can also help curb the internal spread of rumors regarding the sale.

Creating Blind Methods of Communication

There’s obviously going to be a substantial amount of communication with prospective buyers about the sale of your business. Your broker will create blind methods of communication – email, phone number, voicemail… –  as an easy way to protect the identity of your business.

On account of the level of confidentiality required, holding meetings off-site is a smart way to avoid the rumor mill. Your broker’s office is a safe place to engage in private discussions regarding your transaction.

The sale of a business can be challenging to navigate, particularly where confidentiality is concerned. Enlisting a broker to facilitate the transaction is a wise decision – one that will protect your confidentiality, reduce your stress level and provide immense value throughout your entire transaction.

Do you have questions about buying a business or selling a business, give us a call?  We’re happy to help! We can be reached at 612.331.8392 or by email at info@oibmn.com.

Meet our team: http://oibmn.com/our-associates/

See our latest listings: http://oibmn.com/listings/

Demystifying How Business Brokers Get Paid for Buying or Selling Businesses

Finding a business to purchase apart from a business broker can be incredibly challenging. Selling your business on your own does not make sound financial sense. The amount of value a business broker provides outweighs the amount they charge in fees every single time. It’s important when navigating the purchase or sale of a business to carefully consider all aspects of the process – from finding or advertising your business to securing the right buyer to closing the deal –  recognizing that a business broker can assist with each of these components. It’s also important when hiring a business broker to understand their fee structure amid common misconceptions.

Success Fees

A standard fee your business broker will charge is incurred upon the sale of your business. This is called a success fee. This fee is typically calculated as a percentage of the final transaction price. For middle market transactions, the fee is anywhere from 2-5% of the sale price. Because this fee is only paid out when a deal closes, your broker will be highly motivated to close the deal, aligning their motivation with your own.

Business Valuations

In some situations, a business broker will charge a potential seller for a business valuation. If the seller then chooses to list with that broker the fee will be credited against the success fee at the end of the transaction.

Intensive Search Processes

When a buyer hires a business broker to help them find a business to purchase, that buyer will likely incur a charge for the intensive search process.

Alternative Fee Structures Are Available

In some situations, a business broker will consider an alternative fee structure. In a case where the broker is representing the seller, it might be a flat fee up to a certain sale price and a percentage beyond that. In very rare cases a seller and broker might agree upon an hourly rate. It’s important to discuss the fee structure up front so everyone is on the same page.

Business Brokers Provide Value

Business brokers provide tremendous value for their clients. Not only do they possess the resources that often help secure a business for their buyer to purchase or bring active buyers to the table for their seller but they also help navigate what can be a daunting and stressful process and are highly motivated to work hard on their client’s behalf.

If you would like to learn more about the fee structure of business brokers or would like to speak with us about buying or selling a business, we would love to connect! We can be reached at 612.331.8392 or by email at info@oibmn.com.

Meet our team: http://oibmn.com/our-associates/

See our latest listings: http://oibmn.com/listings/

What Disruptors Can Teach

WHAT DISRUPTORS CAN TEACH

Disruption: it’s usually a script in which an innovative upstart overthrows an established firm. While it’s nothing new — fossil fuels disrupted the whale oil industry a few centuries ago — it’s now happening at lightning speed. Technology is partly responsible: As computer processing power grows exponentially, the realm of what’s possible broadens. Technology might be indirectly responsible in other ways, such as improving communication and making information available to the disrupting forces.

Offense Vs. Defense

Arguably, it may come down to offense vs. defense mentalities. The 800-pound gorillas of business are operating on a defense model: They’ve got lots to risk, so they can’t escape their vested interest in the status quo. Disruptors are on the offense: They’re smaller and nimbler, so it’s easier for them to change tracks.

In a recent article on ChiefExecutive.net, editor emeritus J. P. Donlon considers the dynamics of disruption, and observes that the key to success for incumbent companies is their willingness to disrupt themselves. Digging into existing models and strategies didn’t work for Blockbuster — disruptors like Netflix were rewriting the playbook.

It’s also worthwhile to examine the example of counter-intuitive disruptors: those who disrupt by returning to tradition. An over-simple illustration: Watchmaking was once the domain of a skilled echelon of craftspeople. Technology turned watch-making into a mass production factory endeavor, and eventually, companies like Shinola took the process full circle, hand assembling expensive timepieces in Detroit.

Have the Courage to Disrupt Yourself

Instead of trying to protect your traditional way of doing things, ask whether you can serve the customer better by disrupting yourself, and seizing the offense instead of playing defense. One of the great powers of social media is the window it offers on the customer experience. By actively surveying customers’ perspectives, you can understand their needs and what they perceive as shortcomings in the existing model.

Author Donlan invites you to ask yourself these questions:

  1. When was the last time you rolled-out a new product?
  2. When was the last time your business embraced change and did something innovative?
  3. Does your organization focus more on process than success?
  4. Are your management and executive ranks void of youth?
  5. When was the last time you entered a new market?
  6. Are any of your executives thought leaders?
  7. When was the last time you sought out a strategic partner to exploit a market opportunity?
  8. Do you settle for just managing your employees or do you inspire them to become innovators?
  9. Has your business embraced social media?
  10. When was the last time your executive team brought in some new blood by recruiting a major player star?

We hope you enjoyed this article. Learn more about our team of experienced business brokers! 

How To Be An Informed Buyer

HOW TO BE AN INFORMED BUYER

As a potential business buyer, you owe it yourself to be informed. Uninformed or unrealistic buyers not only make poor choices, they also frustrate the parties they work with, such as attorneys, accountants, and brokers. Additionally, while it’s essential to retain such professionals for advice and services, the ultimate responsibility rests on you for every action and decision, so take the time to be thorough.

Ask These Important Questions

As you entertain the possibility of buying a business, here are a few questions to ask and factors to consider.

Are the sellers or the business itself the subject of insolvency proceedings of any kind, such as a bankruptcy filing?

Are there any active contingent liabilities, such as pending or actual disputes with employees, customers, or other parties?

Has the seller made any commitments to employees to increase their compensation? How about to service providers, independent contractors or suppliers?

What’s the relationship with the landlord like? Make sure you know about any active or potential disputes with the landlord, and the history and resolution of any past such disputes.

Seek Detailed, Conclusive Information

You’ve got a right to accurate, timely information from the seller about whether the business is in default on financial, non-financial, taxation, contractual, warranty, or other obligations. Other factors to verify include whether there are pending or unpaid claims for rent, supplies, back wages, or anything else.

In terms of the property itself, ask for a full report on easements, zoning and surrounding property uses. Verify who provides utilities and whether the service has been adequate. Are there natural, geological, or environmental hazards affecting the real property or the business?

Make sure you’re fully informed about any potential environmental hazards relating to substances or products involved in the business. Hazards may include such issues as contaminated soil or water, paint, solvents, fuel, formaldehyde, Asbestos Removal, radon gas, medical waste, and surface or underground storage tanks,

Get a clear, itemized assessment of the remaining useful life of the business’s equipment, vehicles, fixtures, intangible assets, etc.

Immerse yourself in learning about the industry, especially if it’s new to you. Without a broad understanding of the arena, it’s hard to research and understand the overall market for the company’s products or services, or the nature of the competition.

The Risk and Responsibility are Ultimately Yours

Ultimately, you need to ask these questions and more, and then evaluate the responses critically. If any answer seems off, don’t just take someone’s word–dig in more deeply and verify the accuracy of the answers you get. When you take over a business, you potentially accept significant liability for things that may have happened prior to your involvement, so your due diligence is vital, and no one will take it as seriously as you do.

Selling a Business: Overcoming Obstacles

Selling a Business: Overcoming Obstacles

Selling your business: whether planned or unexpected, it’s a big deal. It’s no surprise owners face a variety of practical and emotional obstacles when they entertain the prospect. These obstacles vary widely for personal reasons.

Roughly speaking, there are two ends of the spectrum. Entrepreneurial types enter the business with notions of building a profitable company in order to sell it in the relatively near term. Passion-driven owners typically start and grow a company for long-term operation and profit. Selling the business might not be part of their plan: for example, they expect it to stay in the family. However, circumstances may change, so they should always keep the option of selling in mind.

When faced with the prospect of selling, what obstacles arise, and how can savvy owners overcome them? Here are a few which both entrepreneurial and passion-driven types should consider.

Fear of Selling at the Wrong Time

Timing is a personal matter. When a passion-driven owner says “the profits are great, why would I sell now?” an entrepreneur will say “the profits are great, so it’s the best time to sell.” Of course, either one might face family, health or financial issues which dictate an unexpected sale. So keeping your operations honed and profitable always pays, and recognize that a certain degree of uncertainty is inevitable. Just like you can never know when the perfect time has come to sell a stock or a home, you will never know the perfect time to sell a business. All you can do is keep an eye on the big picture in the context of your industry, and keep your company as lean and efficient as possible.

Fear of Under-Pricing

Most sellers react to this fear by over-pricing, which keeps a business on the market too long, which further jeopardizes its salability. It’s crucial to undertake a thoughtful valuation process before determining your asking price. Take the time and get the help you need to do this, so you’re in touch with marketplace prices and better able to defend the price you set.

Not Securing Expert Advice

Expertise at running a business doesn’t translate into expertise at selling it. While you may resist paying the brokerage fee (roughly 10 percent), a good broker typically adds at least 10-12 percent to the sales price while saving you from lots of headaches. Their services includes helping prepare the company for sale, attracting and identifying qualified buyers, showing the business, marketing and negotiation. Similarly, securing the advice of other qualified professionals such as lawyers, accountants, and financial consultants is a good and necessary investment.

Being Too Hands-Off

Hiring a broker doesn’t mean your work is done. Because you’ve got the inside knowledge of the business, long-term experience in the industry, and serious motivation to sell, you need to view the relationship as a partnership. Disengaging from the selling process will jeopardize it. Communicate with your broker that you’re willing and able to support their efforts, and find out how you can do so. Your interactions with potential buyers also plays a key role. They’ll rely on their impressions of you to inform them about whether the business has the potential they seek, and whether they can expect to manage it successfully.

The Bottom Line

Without a crystal ball, you’ll never know beyond a doubt that you’re selling at the right time and at the right price. Run your business the best way you can; keep salability in mind; stay on top of the big picture in your industry; and recognize the value of outside expertise. Ideally, your decision to sell won’t be forced by outside circumstances, but it’s smart to be prepared for anything.

Visit our website to learn more about how we can help you sell your business!

Selling a Business: The Transition Period

If you’re not considering selling a business now, we predict that you will in the future.

Ideally, selling a business is the culmination of years of planning and intention, but sometimes it’s a frantic, last-minute activity brought about by an unexpected change in circumstances. If you’re planning or hoping to sell a business in the next three to five years, you’d be smart to start thinking about the transition process. And even if selling your business is not in your immediate plans, it can’t hurt to give the process a little thought, because we never know what the future will bring.

At first glance, it may seem there are just two stakeholders in the transaction: seller and buyer. However, there are other parties to add to that list: your employees, your clients and customers, your vendors and suppliers, and possibly your family and your community. All parties will benefit from a smooth, well-planned transition.

Transparent Planning Is Crucial

If you’ve bought or sold businesses before, you’ve encountered some of the complex issues that may accompany the process. You may even recall thinking, “who knew it was so complicated?” A good starting point for your planning might be to reflect on what went right and wrong in previous transactions, and what issues took you by surprise or proved to be trickier than you anticipated.

While different businesses will have different details to work out, here some elements to consider common to nearly all transactions.

Define the Outcome

While the obvious, basic outcome is “sell the business,” it’s valuable to get more specific. The smoothest, least disruptive sale is always a goal, so anticipate potential disrupters and how to mitigate them. A clearly defined end point makes communication easier, and the establishment of a timeline and guideposts easier. Other outcomes to shoot for include minimizing anxiety for both seller and buyer.

Build a Transition Team

Team size and composition will depend on the size and nature of your business, but you generally want to include both in-house personnel and outside advisors. An ideal team might include a couple of top managers, some outside advisors such as your outside counsel and accountant, and a professional business broker/advisor.

Clarify Decision-Making Strategy

At some point decision-making authority will transfer from the old to the new. During the transition period, make sure all parties have clarity about where the buck stops and when decision-making authority is formally transferred. Your business broker will have valuable input on this question.

Financial Changeover

This one’s big: it’s complex, and the stakes are high. Your business broker, accountant, and legal counsel and business insurance Miami company will help make sure all elements are planned and executed responsibly. Accounts, loans, credit lines,  payables and receivables, leases, insurance, taxes, retirement plans: there are myriad financial aspects of the business operation which must be transitioned to new owners.

Establish Accountability

Decide who will be responsible for executing each responsibility, and establish a timeline. Detail the phases, the actions, and the steps to bring about a successful transition, and assign responsibilities with deadlines. Use this to inform communications with other stakeholders: keep them in the loop so they remain confident in a good outcome.

Near Term Developments

Communicate any upcoming issues the new owners need understand and be aware of, such as regulatory changes, ongoing projects, etc.

Training the New Owners

Communicate openly with the new owners about their involvement plans and establish a training plan. Whether they’ll be hands-on or hands-off, they need to know how your business operates.

Staffing Considerations

This is a stressful time for the employees you’re leaving behind, so demonstrate your support for them. The new owners may rely on the existing team or they may be motivated to make changes. While your greatest interest may be the success of the new buyer, you’ll support the new buyer best by keeping your existing employees enthused and positive about the transition.

Planning Pays Off

Working on your transition plan is essential If you plan to sell in the next few years, and it’s a great general “covering the bases” move under any circumstances. If you’ve just bought a business, take some notes now about the pain points and the successes: they’ll be sure to come in handy when the nearly inevitable day comes that you wish to sell your business.

5 Myths About SBA Loans

FIVE MYTHS ABOUT SBA LOANS

The Small Business Administration (SBA) is a federal agency established in 1953 to support entrepreneurs and small businesses. Their mission is “to maintain and strengthen the nation’s economy by enabling the establishment and viability of small businesses and by assisting in the economic recovery of communities after disasters.”

A big part of the support they offer is in the form of loans, and we see lots of misconceptions out there about how SBA loans work, and their pros and cons. Here are five myths about SBA loans, along with the real story.

MYTH #1: The SBA lends money to small business owners

TRUTH: Banks and credit unions make the loans, the SBA simply helps guaranty them. It’s like having a rock-solid co-signer for a personal loan. The SBA guarantees that the bank won’t lose the principal they loaned you if you default, so the bank experiences less risk and is, therefore, more likely to approve the loan, and may offer a larger amount. The SBA guarantees a large portion (between 50-85%, depending on program) of the loan.

Each institution evaluates and approves or declines loans based on their own criteria, so if you’re declined by one, you should still apply at other institutions.

Myth #2: The SBA demands extensive collateral

TRUTH: While the SBA does require that lenders take collateral when available, the lack of collateral does not automatically disqualify applicants. The SBA will help those small businesses whose collateral doesn’t meet lending standards, which also helps borrowers overcome some of the challenges linked with lower credit scores. Borrowers without real estate equity to pledge should seek out lenders who are experienced at relying on the business’s financial strength for repayment.

MYTH #3: SBA loans require a ton of burdensome paperwork

TRUTH: The SBA has revamped their process to streamline it for applicants. Today’s applications are typically processed within 3 to 5 business days, and Preferred Lender Program (PLP) institutions can provide even faster turnaround because they are qualified to approve applications in-house without SBA oversight.

Working with a PLP lender is generally recommended because they are better acquainted with all the ins and outs of the SBA loan process. They’ll know how to determine eligibility, how to optimally structure the loan, and what documents are necessary.

MYTH #4: I can only borrow once from the SBA

TRUTH: The SBA does not limit the number of loans to a single borrower or business. They do observe a limit of $5 million in loans outstanding at any time to a single guarantor. Until a borrower hits that limit, they may take out multiple loans for acquisition, working capital, real estate or other expansions.

MYTH #5: I’ve got a successful business, so I don’t need an SBA loan

TRUTH: SBA loans offer favorable terms, so they are actually very suitable for successful businesses. They offer longer terms, lower down payments, flexible payments and no balloon payments. A business seeking capital should absolutely investigate the SBA option.

If you have any questions about this article or about buying or selling your business, please give us a call at 612-331-8392.

Source: https://www.1hourloanusa.com/.

Business background

Alternatives to the Traditional Sale of a Business

When owners envision selling their business, they often have in mind the traditional sales model of selling the entire enterprise, often for the sake of a large payout to fund retirement. This is a perfectly valid scenario, but we recommend that owners take courses on Financial Education San Jose and consider other options which may be more lucrative specifically a private equity recapitalization structure.

Recapitalization

What is recapitalization? Broadly speaking, it’s the restructuring of a company’s debt and equity balance to optimize its capital structure. It often involves a change in financing, such as replacing preferred shares with bonds. Recapitalization strategies have traditionally been associated with public companies seeking to raise stock prices, but private equity groups have been embracing the approach for acquiring both public-traded and privately-held businesses.

Private Equity Recapitalization Structure

The private equity recapitalization model involves the private equity investor acquiring a majority stake in the business, and the owner retaining a minority stake. Typically this means that the business takes on debt roughly equal to the price paid to the owner. This way, the new majority shareholder isn’t at risk of extracting too much cash from the business while also avoiding depleting their own cash resources. The company’s debt-to-equity mix is thus altered, enabling the original owner to realize some of the inherent value of the business in the present, while their minority ownership stake maintains potential future value from eventual distributions or the next sale of the business. In some cases, owners stick around as the business changes hands from one investor to another, while an equity stake enables them to keep potentially profiting from the business.

Sell Your Business, Then Sell It Again

Ultimately, the most lucrative equation may result from selling your business multiple times under a private equity recapitalization structure.

Benefits of Private Equity Recapitalization

The owner enjoys the clear and direct benefit of cashing out a slice of the business’s value. However, other factors benefit the owner, investor, and management team:

  • New investors may have connections to fresh resources which promote rapid growth.
  • A broader ownership base diminishes risk.
  • When the ownership team diversifies, representing multiple different backgrounds, strategic decision-making is strengthened.
  • Typically, employees in management have the option to invest in the new entity. With skin in the game, their performance may soar.
  • The majority shareholder typically has the deep pockets to support growth and strategic acquisition.
  • The original owner may enjoy capital gains when the business sells a few years down the road – presumably at a higher value.

Risk Of Private Equity Recapitalization

Private equity recapitalization is not without risk, and it’s only suited to larger businesses.

A primary risk is overleveraging. In addition, private equity firms generally require a certain revenue threshold before they’ll invest. Most U.S. private equity firms require at least $20 million in annual revenues or $2 million in normalized EBITDA.

Timing Matters

Ownership needs to consider timing and investment horizons. This strategy is suited for a long game. When private equity firms acquire a business, they typically intend to grow and divest the business over a period of roughly seven years.

An owner wishing to retire in the next couple of years will benefit more from an outright sale. However, if an owner is looking at retirement 5-15 years in the future and their business is sufficiently large, this strategy is absolutely worth considering.

Ownership Team Performance is Crucial

When the ownership team performance aligns with the expectations of the private equity firm, this scenario can be a huge win for the owner.

Sold Your Business? What’s Next?

Sold Your Business? Congrats! Here’s an Idea for What to Do Next.

You’ve spent years building a successful business, and the time has finally come to sell it. The long hours, working weekends, risks, and investments have all paid off. It’s time to hand the reins over to a new owner who will continue to improve on the strong foundation you built.

But if you’re like most entrepreneurs, the cabin life and mornings on the golf course won’t be enough. You’re sitting on a large sum of money from the sale of your business, and you’re eager to find a new opportunity.

We have an idea that can satisfy your need for more R&R with family and that entrepreneurial itch: the family office.

What is a family office?

A family office is a physical or virtual team of family and outside professionals, you bring together to oversee your assets and investments holistically. It’s a very active, hands-on approach to managing your money so it lasts through the end of your life and perhaps into the lives of your children and grandchildren.

What types of assets does a family office manage?

All of them! Most entrepreneurs who sell their businesses have a mix of cash, real estate, private equity, and traditional retirement and other investment accounts. Add that to their spouse’s assets, and there is some serious money to manage.

You may wish to coordinate your estate planning, insurance, trusts, accounting, tax, legal, and philanthropy through your family office. Each one of these areas may require an expert’s help: CPA, bookkeeper, estate planning attorney, and insurance agent. While these professionals may not work in-house at your family office, they will coordinate with your family and each other to manage your assets responsibly.

Who benefits from a family office?

You and your family do. Managing the operations of a family office can ease the transition from business owner to retiree. It also engages your spouse, children, and grandchildren. They’re empowered to make decisions on how and when to grow your assets and what philanthropic projects the family should support.

The family office is an often overlooked option for entrepreneurs who are ready to sell but not ready to fully retire. For help starting a family office for you and your loved ones, contact Opportunities in Business today.