Exit Planning
On average, more than 90% of a business owner’s net worth is tied up in their business. The transition out of the business will be the most critically important financial event of a business owner’s life. This transition can be a complex, hit and miss approach, put into place when the owner has just had enough or gets sick or dies, or it can be a relatively simple, systematic approach, controlled by the owners objectives and initiated 3-10 years in advance of the transition.
Our process follows the BEI Seven Step Exit Planning Model. The goal is to develop a plan that will help you transition out of your business on your own terms so that you can leave when you want, for maximum value and minimize that tax consequences of the sale. Proper knowledge and preparation can possibly mean millions of dollars to you when you ultimately leave your company.
The seven step exit planning process is summarized as follows:
- Step 1: Exit Objectives
Have you determined your primary planning objectives in leaving the business, such as:- Your desired departure date?
- The income you need to achieve your financial objectives?
- The person to whom you want to leave the business?
- Step 2: Valuation and Cash Flow
Do you know how much your business is worth? Do you know what the business’s future cash flow is likely to be after you leave it? - Step 3: Making the Business More Valuable
Do you know how to increase the value of your ownership interest? - Step 4: Sale to Third Party
Do you know how to sell your business to a third party in a way that will maximize your cash and minimize your tax liability? - Step 5: Transfer to co-owners or family
Do you know how to transfer your business to family members, co-owners or employees while paying the least possible taxes and accomplishing your financial goals? - Step 6: Business continuity upon death or disability
Have you implemented all necessary steps to ensure that the business continues if you don’t? - Step 7: Wealth Preservation Plan
Have you provided for your family’s financial well-being and continuity should you die or become incapacitated?
One of the key ingredients to a successful Exit Plan is time. Although you can’t control the ups and downs of the M&A cycle, you can control the preparation of your business. If you plan to leave your business within the next 10 years, the time is now to start working on your business and bring under your control, the many moving parts that are required to accomplish a successful exit.
The first step is a complimentary half-hour telephone conversation with our Exit Plan Advisor. This enables you to learn more about the Exit Planning process and what is involved. The call also allows you to learn more about us and how we can help you. You'll know at the end of the call if the chemistry is right and you want to proceed.
Featured Exit Planning Consultant
Rick Tifone, MBA & BEI Certified Exit Planner
Rick brings over 25 years of executive management, marketing, sales, consulting, and exit planning experience to Cayenne Consulting. Rick specializes in working with business owners as a coach and advisor. Rick's clients become more effective, more successful, and get more joy out of their business. He has been working with companies involved with software development, IT services, manufacturing, real estate brokerage, commercial and residential real estate, executive recruiting, medical equipment, construction, and government sourcing.
As founder and CEO of Danet, Inc., a consulting and systems integration company providing solutions for the telecommunications industry, Rick managed the profitable growth of the company from one employee to over one hundred. He was recognized by the Pittsburgh Technology Council as the CEO of the fastest growing company in the $10M to $25M range. During his nine years at Danet, Rick guided the company through dramatic telecommunications market changes and a transition from a software company to a systems integration and consulting company. Rick conducted business throughout the U.S. and Canada, South America, Europe, and the Middle East.
Rick's previous public company experience includes positions at General Dynamics, Alcoa, Wang Laboratories, and Tandem Computers. He brings a unique perspective from being both a professionally trained business coach and an experience business leader who has started and grown successful businesses.
Rick's formal education includes a Bachelors Degree in Computer Science from the State University of New York at Potsdam and an MBA from the University of Pittsburgh's Katz School of Business. Rick also holds a BEI Certified Exit Planner Designation.
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