Private Company Valuation Mistakes & Case Studies - Part 2.
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- Опубликовано: 28 июн 2024
- How does net working capital impact the valuation of a private business? What happens to a private company's value if there is excess or deficit net working capital? How do you value a private company correctly? What are common valuation mistakes that buyers/sellers make when attempting to value a private company? This is the part 2 video in the private company valuation mistakes video series. We will discuss four more valuation mistakes that I have seen buyers/sellers make in small business/lower mid-market M&A transactions.
[3:26] - Quick Recap of Net Working Capital (NWC) & What is "Normal" NWC?
[7:30] - Mistake #4: Ignoring NWC in valuation - Excess/Deficit NWC on the Balance Sheet
[11:13] - Case Study #1
[14:21] - Case Study #2
[18:45] - Mistake #5: Cash-Free/Debt-Free Closings for NWC intensive or high growth businesses
[22:00] - Case Study #3
[26:21] - Case Study #4
[32:24] - Mistake #6: Confusing book value with enterprise value
[34:14] - Case Study #5 & #6
[38:28] - Mistake #7: Ignoring the impact of market rent on your business' value
[41:30] - Case Study #7
The case studies in this video are from real life past M&A transactions completed by Roblee Capital with some changes to the figures to ensure the confidentiality of our clients.
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Roblee Capital is a Toronto-based M&A Investment Bank focused on serving companies with revenues between $1MM to $100MM primarily offering sell and buy-side M&A services. We work with Canadian-based business owners looking to sell their lower mid-market business. If you are a Canadian business owner looking to sell or buy, please reach out so we can connect at the link below:
www.robleecapital.ca/
Your videos are condensed experiences that can save people a lot of money. Love the content.
Thanks for watching! I agree, hopefully it helps people out.
Notifs on!
Love it!!
Same
love these videos, thank you for making them!
More to come!
Thank you!
Love your vids.
Thanks for watching!
This is good stuff man
Thanks for watching!
Hello Robert, thank you for the respond on SBA, it helped me narrow the next step. I'm currently writing a business plan and it quite challenging because I gathered a lot of information, tools and don't know how to start. Please what do you recommend me to do ?
Hi, how do you treat capitalized cost on the balance sheet in m&a? Asc606 sends commissions to the BS and amortizes them over time. This impacts the ebitda...
Hi Rob! Do you mind give me some advice on my career decision: Commercial Banking At BB Or Investment Banking At MM?
I recently received two offers. One for Commercial Banking (generalist) at a BB in NYC, and the other for Investment Banking at a MM (in a decent group/industry) in the Midwest. I networked hard at both firms. Struggling to make a decision because I like the band name, location, and the work-life balance of the BB job, but I also like the more interesting work, the higher pay, and a possibly more relaxed, friendly culture at the MM bank. No interest in jumping to PE or pursuing an MBA in the future. Any suggestions on how to navigate through this situation? Thanks for your inputs in advance!
Great question, its tough one to answer. If I was starting out my career, getting proper training at a big BB and having exposure earlier on to direct client sales experience (ie. doing CB rather than IB) would be my priority, you can always go back to MM IB after 2+ years at a BB. In either case, you are blessed with two good options so you cant go wrong, its just a matter of preference and what types of skills you want to prioritize at this stage in your career. Congrats and good luck!
Off topic but can you do a video explaining different types of debt? Like what's mezzanine debt , subordinated debt ,junior debt ect?
Good idea, I will add it to the list!
Hello !
I'll like to have a training session in the U.S to prepare me get a business loan. Where do you think I can best obtain this training
It would be best to check out the SBA Loan website, they have free loan counselling to help you understand the process. Good luck.
Are we getting a VC valuation series?
🇿🇼🇿🇦
Something for future videos for sure, nothing in the works yet relating to VC.