By the end of 2015, there were 1.14 million small businesses in Canada, making up 98% of Canada’s business landscape. Collectively, these businesses employed over 8 million people. And, each and every one of these businesses needed financing to get off the ground and grow into a successful venture. Fortunately, there are a number of options when it comes to financing a small business in Canada.
Mergers can be exciting to talk about but in many cases the new partners will be larger than the other partners. While this disparity in size could cause problems, it doesn’t have to. A lot of this comes down to the planning before the transaction and the execution afterward. With that in mind, here is a glimpse as to what happens when a small business is merged with a mid-sized business.
Private equity. It is a broad term used to describe the funds that invest in businesses large and small. While the media generally focuses on big players such as KKR and the Carlyle Group, there is an entire ecosystem that specializes in small-to-medium sized businesses. This is known as the lower middle market. Here is an overview of how these funds work.
Continue reading “How Lower Middle Market Private Equity Works”
When it comes to selling a business, one pool of potential buyers which cannot be ignored is private equity (PE). These funds specialize in buying and running companies, ultimately growing the business and then selling it for a profit – at least, in theory.
For small and medium-sized businesses lucky enough to get past the stage of worrying about keeping the lights on, growth is the next challenge. But did you know that you don’t have to rely on organic growth alone to bring your business to the next level?
When it comes to selling a small or medium-sized business, there is a different option a business owner can consider: an earnout. While an earnout can help the buyer and seller agree to terms, this sort of business agreement is not without its risks. As such, here is a rundown of earnouts, the pros, the cons, and what to watch out for.
Family owned and operated companies have a way of becoming all-consuming. If your family happens to have a business, then you know the feeling. Vacations become board meetings while dinners and holidays become sales meetings.
No one is (or should be) indispensible in their business; but owners need to consider that one day, you will be no longer able to run your company.
Continue reading “Succession Planning for Your Business”
Ask any business owner and they will tell you with pride how much their business is worth. However, many of these business valuations wildly overestimate what they could actually sell their company for.
Continue reading “The Truth About Business Valuations”
“One day Alice came to a fork in the road and saw a Cheshire cat in a tree. Which road do I take?” she asked. “Where do you want to go?” was his response. “I don’t know”, Alice answered. “Then”, said the cat, “it doesn’t matter.” – Lewis Carroll, Alice In Wonderland
Continue reading “Know what you want when buying a business”