BizBuySell.com recently released their statistics on the M&A marketplace. They interview many business buyers, business sellers, business brokers, and M&A intermediaries. This is an important survey becuase they compile data for over 1,000 transactions that took place during the quarter, and many more that are listed for sale.
The report still shows that the market is still far below where it was two years ago. Although bad, it is improving. The number of closed transactions in the third quarter inceased by 7.4% compared to the second quarter. It does seem to be turning around.
What does this mean to someone either buying or selling a business? Is this the right time to invest in a small company? Should I hold off selling my company until things really improve.
The most important step is determining your goals as a buyer or seller, and not letting the market dictate your timing. Unlike buying a stock, or going to a store during a sale, buying or selling a business is not instantaneous. In may take many many months for the transaction to complete. No one will be able to accurately predict what the market will do during that time. In the meantime, there will be buyers paying below and above market levels, and sellers selling below and above market values.
You need to determine the value you need to live your lifestyle, or what monies you need from the business. If you are buying, you need to evaluate risk and reward, and determine where your investment dollars can be best spent. If you are a company seeking to perform a strategic acquisition, you need to analyze if a business acquisition makes sense or not at a specific price in order for you to realize your business goals.
There are too many factors in the marketplace. Even if the economy comes back with a roar, will there be an oversupply of companies coming into the marketplace that will keep a lid on multiples? Will the economy only come back for a short window of time? No one knows the answers to these questions with certainty. Therefore you need to focus on what is certain – what is it you need from the acquisition or sale.
Ken Ducey, Jr.
Princeton Capital Strategies, LLC.
Beyond a Business Broker
Mergers & Acquisitions (M & A)is a unique business opportunity to sell their business, but because most business owners only sell a business once in their careers, they learn too late how to work with business brokers, business valuation firms, and investment banks. Princeton Capital is an M&A intermediary in the CT NY area that provides value beyond that of a typical business broker. Princeton Capital can bring more qualified buyers to a business owner in less time, because our methods come from world-class investment banks instead of typical business brokers. 
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