Chad Schmidt, Founder of TimoloGC, and Matt Gilbert, Principal of GaP Business Advisors, discuss post exit transaction, what goes in your pocket.
[00:00:08] MATT GILBERT: Buyers typically focus on the number - "I want 10 million, I want 8 million..." and what they need to be focused on..
[00:00:18] CHAD SCHMIDT: The buyer or the seller?
[00:00:19] MATT GILBERT: I'm sorry the seller, you got me. The seller is focused on that high number that I call it the headline number. You know they might get 10 million, but they might only get 6.8 at closing and the rest is in and earn out.
[00:00:37] MATT GILBERT: So they focus on the 10. The broker needs to come in in here and go what we need to be making sure: is this structure, is this offer gonna be putting the most in your pocket, right? The biggest bill when you sell your business is your tax bill. Then you're gonna have an attorney, and you're gonna have a representative, you're probably going to have a tax CPA involved, there might be some consultants, there might be some insurance you've got to buy. There's a lot of expenses to get to a successful closing and a broker can kind of take the emotion out of this thing and say hey wait a minute you're focused on the wrong thing here what we're really focused on is what are you clear when all the dust settles in this deal and we might be able to clear more if we consider a little different structure that you were initially turned off to. Many business owners will focus on the wrong thing at the wrong time because they don't understand the hurdles that you have to get over before that becomes important.
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