|
Internet Business Articles Free home based internet business SOURCES
Initiating and sustaining a flow of potential deals is one of the most challenging tasks in buying a Free home based internet business. In general, expect to look at dozens of deals for every one that appears worth pursuing. A seemingly endless amount of groundwork is often necessary to initiate a deal, and a targeted effort is far more likely to result in a high percentage of attractive candidates than a random search. Thus, one of the first orders of Free home based internet business when starting out is knowing where to look.
Depending on the size deal sought, there are a number of potential deal sources, each with its own approach to acquisitions. Free home based internet business brokers are the most readily available resource; they are listed individually in the Yellow Pages of most phone directories and advertise in the Free home based internet business sections of many newspapers. Brokers work on behalf of sellers to find appropriate buyers for their clients' Free home based internet businesses and are compensated by the seller at a given percentage of the price. Occasionally, a broker will work for a buyer in return for a retainer and/or a. percentage of the ultimate purchase price. It should be emphasized, however, that brokers' interests lie in closing a transaction; they should not be considered impartial consultants.
Free home based internet business brokers obtain listings through cold calls and advertising. Because the listings are actively marketed, it is safe to assume that you are not the first prospective buyer to see a Free home based internet business. More reputable brokers tend to regulate how "shopped" a Free home based internet business becomes in order to preserve its value, and some refuse to list properties sellers have already tried to market on their own. At your initial meeting with the broker, you should be prepared to describe your financial constraints and industry preference. It is also valuable to indicate that you have a well-defined time horizon for a search and some knowledge of the target industry. You may want to touch base occasion ally with each broker you meet, but it is a safe bet that you will be notified of interesting opportunities if you are a qualified buyer.
Independent brokers, which are almost entirely unregulated, are often the first place people turn to generate a deal flow. Because no license is required, and anyone can claim to be one, it is essential to check a broker's references and reputation with intermediaries and past clients; in most states anyone with a telephone can claim to be a Free home based internet business broker. One can find a seemingly endless supply of one-person brokerage services in most any city. Typically, the deals they offer are small—less than $500,000 in sales—and are owned by entrepreneurs who have an unrealistic impression of the value of their Free home based internet businesses, an impression often fueled by the brokers themselves.
Professional brokers are Free home based internet business firms—rather than simply individuals—who specialize in the sale of companies. These organizations usually operate on a more professional basis than the independents, but they too represent (he seller. Their interest is in obtaining a high price for the company, thereby ensuring themselves high commission fees (usually around 10%-12% at closing). However, most brokers are more interested in closing the deal than they are in squeezing out the last dollar in purchase price. Also, note that deals coming through professional brokers are very likely to be highly "shopped." The legitimacy of deals carried by professional brokers are often prescreened but usually carry a premium price.
. if Vein tire capital firms are often looking for liquidity on investments they \nade three to five years earlier. Venture-backed companies that have reached this stage are generally beyond many of the risks associated with start-ups and may offer a solid acquisition opportunity. Several points should be noted, however. First, venture capitalists are highly sophisticated investors and will probably extract the highest possible price for the company. Second, they want liquidity for their investment and will be less interested in earn-outs and other creative financing than in a deal financed primarily with cash. In addition, existing management will most likely be highly entrepreneurial and wary of controls introduced by new owners. Finally, as venture firms are often motivated to sell their problem companies, it is critical to understand the firm's situation thoroughly.
Leverage funds in some situations pose competition to the buyout effort. As a potential deal source, however, they may present opportunities to take over deals that are of no interest to the LBO fund. Such deals may be attractive candidates that simply did not match the particular focus of the LBO fund. LBO firms may also sell portions of acquired Free home based internet businesses to generate cash to pay back debt, and these, too, can be attractive deals.
Personal contacts, although often overlooked, may be a helpful source of deals; and contacts with people who have successfully completed the search process for their own Free home based internet businesses may provide both information and moral support. They may even be able to suggest contacts and strategies or allow you to tap their network; they may point out some of the pitfalls they encountered and suggest useful rules of thumb. You can locate these resources through your Free home based internet business and personal network or by tracking recently completed deals.
On occasion, Free home based internet business periodicals will help you identity opportunities. Indications that a company will be spinning off subsidiary operations are frequently mentioned, and the Wall Street frontal, INC, and Venture routinely list Free home based internet business opportunities. On the local or regional level, there are Free home based internet business journals, franchise fairs, classified ads, and notices bankruptcies and deaths. Newspapers, and the offices of the county clerk and court clerks, are good sources of leads, as are computer databases (usually available on a time-sharing basis) that provide lists of prospective buyers and sellers of Free home based internet businesses. Academic and commercial institutions in some communities sponsor industry forums or trade association meetings. Industry and phone directories (Yellow Pages, Dun & Bradstreet, Million Dollar Directory, Thomas' Register of American Manufacturers) may be useful for a cold call or letter writing campaign and as a possible screen for industry, size, and location. In addition, you can run this process in reverse by placing your own advertisement in newspapers or journals, stating your needs and criteria for purchasing a Free home based internet business.
Local banks represent a broad range of local Free home based internet businesses and have in-depth knowledge of their finances and managerial situations. Like Free home based internet business brokers, the mergers and acquisitions-type departments of banks are primarily interested in closing transactions. Their inventory of deals may include both banking clients that are for sale and other firms that have engaged them to find a suitable buyer. A bank may also be amenable to helping you conduct a search on a success-fee basis. A good banker will be instrumental in structuring the financial arrangements of the newly acquired Free home based internet business and, often, will expect to become the new firm's principal banker.
Trust departments of banks are often the executors of estates, and, where there is a need to dispose of a Free home based internet business, may serve the same role as an estate lawyer. While the trust officer has a fiduciary responsibility to seek the highest price for the Free home based internet business, he or she has an equally important interest in keeping the transaction clean, fast, and, if possible, in cash.
Bank work-out departments are another potential source of bargain opportunities. Although the bank has a strong interest in not disclosing credit problems, it may serve as a confidential go-between for a potential buyer and the owners of a deeply troubled Free home based internet business. However, because of pressures within the bank to reschedule debt and the willingness of many owners to collateralize additional loans personally, most troubled loans are in. fact worked out.
Traditional, mainline investment banks pose both a problem and an opportunity for buyers seeking a mid-sized deal. The problem is that investment banks are rarely interested in deals below, say, $20 million. Attracting their attention can be troublesome, and getting them to spend time moving on a small deal requires patience and tenacity. The opportunity exists because small deals carried by the investment banks are unlikely to have been widely shopped. Thus owners who rely exclusively on an investment bank to market their company will probably not receive extraordinary service, and a buyer who works this route may find a responsive seller on the other end of this inattentive pipeline.
|