Know and Grow the Value of Your Business: An Owner's Guide to Retiring Rich

A 63-year-old woman said to author and valuation expert Tim McDaniel, “I need to sell my business for $2.5 million to support my country club lifestyle.”  The reality was that her business was worth less than $1 million. How could she have been so wrong? What was the long-term impact of her misinformation? In a flash, McDaniel realized that most owners work in their businesses and not on their businesses. McDaniel, veteran of over 1,800 valuation and M&A deals, has seen the look of surprise on client faces far too often: “It’s only worth that much?!”

In the rush of day-to-day work and decisions, business owners sometimes forget that their business is an investment—and something they need to watch, nurture, and care for just as they would a valuable antique vase or painting. Know and Grow the Value of Your Business: An Owner's Guide to Retiring Rich shows readers how to develop the “investment mindset,” value the business, bolster that value and maximize the return on their investment, and, finally, “exit” the business either through a sale to outside parties or by passing it on to family or other business insiders.

This information couldn’t be more important: In published surveys, and based on McDaniel’s personal experience, the majority of a business owner’s wealth (60% to 80%) is tied up in the value of the business. This is their most important asset, but they usually guess at its value and have no concrete plan to increase that value. They also have trouble determining the optimal way to exit the business. More often than not, this leads to heartache; the owner is not prepared financially or psychologically for life after exiting the business.

More than anything, this book shows that an investment is only successful when the owner is able to exit on his or her terms. An exit can occur through a well-thought-out plan, or it can be forced by circumstances beyond an owner’s control—or something in between. This book explains the various