Business Owner Looking to Monetize

A business owner came to us after receiving an offer to purchase their business.

Successful small business owner with around 50 employees
Accumulating a lot of cash in bank; no clear investment strategy
Not sure what financial resources are needed for the rest of his life
Unsure of whether it’s a good time to sell his business, or a good enough offer
Married, with two adult daughters
Would like to provide financial assistance to the next generation if resources allowed

Developed a long-term cash flow plan to project retirement income needs
Determined after-tax proceeds needed today for a successful financial plan
Compared the pros and cons of different payout methods
Analyzed retention of the business versus an immediate liquidity event
Determined that the present value of future cash flows was not substantially greater than the current offer
Analyzed the risk associated with timing of the sale relative to the current business cycle
Recommended to sell the business
Implemented a tax-managed SMA to reduce capital gains exposure during business sale

Recommended a certified valuation analyst to provide an independent opinion
Introduced him to a business broker for due diligence on the offer
Worked with his business and personal tax advisor to accurately reflect a hypothetical sale in the financial plan
Recommended a corporate attorney to review operating documents and employment contracts to ensure a smooth transition
Worked with an estate planner to transfer a portion of the business to children in an irrevocable trust to remove future appreciation from the estate
Coordinated with an expert to design and purchase an appropriate amount of life insurance within an irrevocable trust to fund the projected estate tax liability