Steven Chiavarone, CFA and economist with Federated Hermes, presented at our annual State of M&A conference held in Green Bay. Chiavarone spoke to the conflict and other economic indicators likely to affect mergers and acquisitions in the years ahead. Specifically, he addressed inflation and the risk of recession.
Inflation, employee shortages, international tension, this little thing called COVID-19… In many years, any one or two of these dynamics could have put a damper on M&A activity and business values.
For many entrepreneurs, the business becomes their identity. It gives them direction. Without that outlet, some former business owners become unmoored. Suddenly, their phone isn’t ringing as much. No one needs them to make hard decisions anymore, and that can be troubling for some folks.
I don’t know of anyone whose business wasn’t affected, at some level, in 2020. Businesses were either on the covid slump or the covid bump.
As part of our annual State of the Market M&A conference, held virtually this winter, we invited three private equity (PE) firms to review and submit an offer on a hypothetical company. They revealed their offers at the conference, and we held a panel discussion on why they valued the company the way they did.
Business owners are burned out, worn out, and getting out. More than 1 in 4 business owners who put their business on the market this spring did so because of burnout. That’s according to a first quarter survey of business brokers and M&A advisors conducted by IBBA and M&A Source.
As we predicted, many companies and Private Equity firms are on the hunt for new opportunities and are spending the “dry powder” (cash reserves) they amassed while waiting out the uncertainty with the pandemic in 2020.
What is the biggest characteristic that contributes to future success? Think for a moment about how you would answer that question. Would you say intelligence? Strategic thinking? Vision or subject matter expertise? Why do you think you’ve gotten where you are?
Financial planning begins with knowing what your business is worth. For business owners, how can any decisions be made about securing the future of your family, employees, and business without knowing the value of your largest asset? Get started with an estimate of value from DealCoach today!
According to the quarterly Market Pulse Report, we know that when it comes time to sell their business, less than half of all business owners plan ahead. What that means is that most business owners wait for some kind of trigger before they go to market. Those triggers are reactive and often negative in nature, stemming from a family health issue, conflict, or (most commonly) burnout.