Frequently Asked Question Episode: Each week I answer three questions about business value or selling companies that come in from the website or social media. This is a little bit shorter of an episode, but hopefully it will be helpful in your journey to making a salable company. This week's questions are:

What do you get when you buy a business?

• You want to buy the assets of the entity as it is the most tax advantageous to you, limiting the risk associated with acquiring stock.
• The assets you acquire typically include: Inventory Furniture Fixtures Equipment Goodwill Trademarks Trade Names Digital Assets (sometimes, accounts receivable, accounts payable)

How to sell businesses for a living?

I'm assuming you are looking at becoming a business broker or investment banker. Here are a few things to keep in mind if you venture into this industry.

1. Age and experience matters - You cannot expect a business owner to entrust most of their net worth to you without any assurance that you know what you are doing
2. It would be best if you had a runway. It takes 6 to 12 months on average to sell a business. It would help if you had enough capital to get your practice up and running, as at least a portion of your fee will be success oriented.
3. It would help if you had an understanding of financial statements and sources of capital
4. You need to understand how to evaluate buyers concerning your deal
5. You need to know you are in sales (the business is your product) and are not there to fix the business, but to sell it. (Some firms offer ancillary exit planning services-I assume you are only interested in selling)
6. You need to understand that the process is relational between you, the buyer and seller. There are a lot of dynamics at play - most of which you don't know about. Everyone has baggage.
7. You need to understand that the best buyer may not be paying the highest price
8. You need to realize that you are operating in the irrational (for both buyers and sellers). Expect decisions and positions that are counterintuitive.
9. You need to know the difference between value and price.
10. You need to know that the closer you are to closing, the less control you have.
11. Bonus: Finding a buyer is only about 30% of the job. Getting it to the closing table is where you earn your fee. There likely is no better time to be getting into the business. Best wishes.

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