The National Spotlights Shines on Small Businesses ..

Business Owners: There's No Time Like the Present

I’ll figure it out when I’m ready to retire, which is the day after never…. That is the response we get from small business owners when we ask how much their business is worth.


The wealth of nearly two-thirds (70%) of all small business owners is tied up in their business. For many of those individuals, the business becomes the personal retirement savings vehicle. Those individuals, however, could be driving blind. Without knowing the value of the business, how will they know when they can stop working or the lifestyle to expect in retirement?


Having the information needed to prepare adequately for retirement is just one of the many benefits to a business valuation. Here are several others:


·       Increase value. What is measured improves, and valuation is no different than establishing and overseeing a sales quota. A comprehensive business valuation willprovide owners with a clear explanation of the value of the business along with evidence to support the result. It can tell an owner if efforts need refocusing, or … even better ..  if the company is headed in the right direction. The data helps guide strategic decisions and business development plans and can even help an owner determine whether the right people are in place to support long-term goals.

·       Capital infusion. Outside investors and lending institutions will evaluate the business plan, shareholders’ agreement, investment memorandum, and valuation before investing or loaning capital.

·       Mergers, acquisitions or share-swaps. A business valuation facilitates a negotiation between entities entertaining a possible merger, acquisition or share-swap. 

·       Dissolution of partnership or partial exit by an owner. When a business partnership goes bad or partners agree to part ways, the parties have to find a fair and equitable split of interests. Whether the weighting shares changes, one partner buys the other out, or the partnership gets dissolved, a business valuation will facilitate the process.

·       Divorce. Business interests represent marital assets and could become part of an owner, partner, or shareholder’s divorce settlement. Both spouses may approach the settlement proceedings with independent business valuation reports, so historical valuations could provide valuable insights.

·       Tax strategies. A valuation report can lead to tax benefits an owner might not otherwise claim. A current valuation is also required for estate tax settlements, to calculate capital gains tax liabilities, and for income or property tax disputes.

·       Employee incentive programs. A company must disclose its value to employee to satisfy annual requirements for Employee Stock Ownership Plans.

·       Insurance planning. Nearly three-quarters (70%) of small businesses do not have adequate insurance coverage. When an owner doesn’t know the value of his/her business, it is challenging to determine how much insurance is needed. Also, if an owner is injured or wrongfully distracted from business, a historical valuation could help recover losses.


The real reason most business owners put off knowing the value of their business could have less to do with timing than an error in perception. Traditional business valuations involved an extensive, expensive, and seemingly invasive process. Thanks to innovative technology, however, those barriers no longer exist. An online valuation cost a fraction of what traditional business valuation specialists charge, and can be completed in minutes, not weeks.


While business owners are often stretched for time, when it comes to discovering how much the business is worth, there’s no time like the present.


Our firm specializes in meeting the financial needs of small business owners, and business valuations is a critical step in our process.  To get started on your business valuation, simply go to

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Keep Calm and Carry On

Keep Calm and Carry On

Dr. Charles Lieberman

Chief Investment Officer


Investors were caught by surprise by Trump's victory, but it remains to be seen who he names to key cabinet positions, who his key advisors will be, and which of his policy initiatives will move forward and in what form.  Much of this is really unknown.  It also remains to be seen how Trump will work with the Republican establishment, who he will need, if he's to get any of his proposals through the legislative process.  Uncertainties abound, since Trump typically provided very little detail around his policy ideas.


Nonetheless, the U.S. economy is very resilient, and given the rebound in stock prices off last night's lows, so is the market.  The initial decline is already abating, as some investors step in to buy the lower prices.  A large decline in stock prices seems unlikely to us, at least not without evidence of some irresponsible action that might not occur.  Investors should not jump to conclusions.  The performance of different sectors is just breathtaking.  Companies that export are down, pharma is up, financials are up, and long-term interest rates have reversed course.  After long-term Treasury bonds rallied sharply, they are now down sharply.  Nonetheless, we will all be waiting with bated breath to see what policies are forthcoming.  Fortunately, we seem to be reasonably well positioned for this outcome.


The initial market reaction to Trump's victory was very telling.  Investors clearly wanted Clinton to win, partly because investors thought they understood what she would do with policy and were comfortable with that outcome.  Trump represented more of a policy unknown.  And as the ultimate political outsider, particularly since he campaigned on policy generalities with little policy detail, investors are very uncertain what he will do.


A few broad strokes are probable.  Trump argued for infrastructure spending, which should garner fairly broad support, which should be a positive for those kinds of companies.  But, how will that be financed?  Trump hasn't proposed either tax hikes or spending cuts to pay for such a program.  Will Congress accept the spending without the financing?  Many Republicans would not be comfortable with such an approach.  That is likely why interest rates have surged after the initial knee jerk reaction of investors to buy such bonds and drive yields down.  Even with a Republican majority, many Republicans are too fiscally conservative to accept such a proposal without some financing mechanism.  Without any doubt, the direction of policy is uncertain.  The markets are repricing at lower levels to reflect this heightened level of uncertainty.  But it is dangerous to just assume the worst, even as some people fear a Trump Presidency.  Until Trump's policies become more explicit, the uncertainty will remain high, so volatility may remain high, but these could prove to be trading opportunities.


These are some initial reactions on our part.  We will provide more thoughts over the course of the day.

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