Simply put, earn outs are when a seller receives additional compensation from the buyer only if pre-determined bench marks are hit in the future by the new owner.  The intent of the buyer is not to hand over all the cash up front at the date of purchase, but for an installment type sale based upon the future successes of the company.The risks, or actually reality more often than not, is that the new […] Continue Reading…

As we close down on 2009 and reflect on the year’s successes and failures, I look towards 2010 with some minimal optimism.  That’s not saying that I had a great year, on the contrary, but more as an acknowledgement that I’m a typical optimistic entrepreneur.  This was a tough year for everyone, maybe not so much for the big banks who received billions of bail out money, but definitely […] Continue Reading…

Feelings are obviously very personal and will vary with each situation.  By no means am I an expert on feelings, on the contrary, I have been called insensitive, frank, blunt, uncaring, unemotional, and a few more that I can’t repeat.  My intent here is not to tell you how you are going to feel but more an overview of the feelings that you might experience.  I ran my business with my head and if […] Continue Reading…

The short answer is no you are not legally required to use an escrow when selling your business.  Escrow is a process where a neutral 3rd party oversees the transaction and provides assurance that no funds or title will exchange hands until all of the instructions in the transaction have been followed. 

The escrow agent’s job is to follow the escrow agreement, hold any deposited funds and manage the documents until the change of ownership is complete.  The escrow services are usually […] Continue Reading…

The process of selling your business is a very emotional test for any business owner.  A business is a living creature that ebbs and flows daily with internal and external influences.  The challenge is to successfully manage this creature through day to day operations while going through the selling process.  It’s not just the time requirements but it is the emotional focus that I see owner’s have hard time with during escrow. 

Most entrepreneurs have a love/hate relationship with their […] Continue Reading…