Our Fiduciary Advisers are ready to start that conversation on how Add-Backs can impact you.
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Business value “add-backs” refer to certain business expenses that are truly one-time in nature, are incurred due to the present owner’s community relationships or are otherwise not necessary to the ongoing operations of the business. The reason that identifying these expenses while thinking about business value in certain exit scenarios is so important is because any business is only worth what a future owner expects to receive in benefits from owning your business (i.e. net expected future free cash flows).
When considering an exit from your privately-held business, it is important to remember that it is your responsibility to demonstrate the future earnings power of your business to your future owner. By following a simple process, you can normalize your cash flows and substantially improve the potential value that a future owner is willing to pay you for your business.
If you’d like to learn more about how our firm of Fiduciary Advisers can help you navigate the world of financial add-backs, please complete the form below and we will contact you within one business day.