Maximizing Business Value: Insights from M&A Advisors

Usually, sellers have an overly lofty perspective on their business's value, and part of our job as advisors is to provide data-driven valuation advice based on the market. Sometimes, an upshift is in order.

Yesterday, we were speaking about diligence with a Sierra Pacific Partners sell-side engagement client that we're preparing to run a process for, and I said, "Look, given where we are valuation-wise, when things start to move forward, they're going to move quickly and we can't lose momentum. This is going to be a full-time job and you've got to be focused or have someone in the company that is."

He responded, "I understand that, but look, I don't think the business is worth much. I'm just a carpenter, a framer."

We replied, "How many carpenters do you know that made over $10M {in unadjusted net income without D&A} last year? I know one, and he's on this call."

No matter where our sellers sit, our job is to best position them within the marketplace. This one just so happens to want to sell so he can get back to what he enjoys doing most - carpentry.

As an aside, per the U.S. Census Bureau new home construction is at a 50-year high. Not a bad time to be a carpenter