iREV is an acronym for improve Revenue, Earnings and Valuation. It’s an exit planning and M&A prep program for business owners who want to sell their company (or hand it down to hand-picked successors) within the next 12-36 months.
iREV can quickly tell you if your business is salable, what it is worth, and if you are ready to engage with buyers. The results can improve the odds of a successful sale by as much as 50%. It can also increase the price you will be offered by serious and qualified buyers. iREV’d businesses have a higher probability of selling at a higher valuation than those that are not iREV’d.
iREV is based on 30+ years of experience buying and selling companies. It incorporates the important criteria used by corporate acquirers, private equity groups, and individual buyers, to evaluate and act on business opportunities.
TYPES OF BUSINESSES iREV IS DESIGNED FOR
iREV is designed for small businesses of all types, but ideally suited for those that have been in business for at least three years and generating at least $2M in annual revenues. It is not industry specific, but rather, focused on the fundamentals of business excellence. It is designed for business owners who want to thoughtfully plan their exit, maximize their valuation, and get fully prepared to undertake a sale.
Upon completion of the iREV program, you will know:
- What buyers want to know most about your business, including a comprehensive list of information and documents they will request.
- What the most important actions/changes you and your team can make to increase both the number and value of offers you will receive.
- What data/visuals will be needed to present the opportunity and tell a compelling story.
- How to navigate due diligence, overcome concerns and objections, negotiate terms, and drive to a successful transaction.
HOW IT WORKS: Step-by-Step
STEP 1: Business Sellability Assessment
The program begins with a confidential, high-level Business Sellability Assessment. There is no cost and no obligation for this assessment.
This assessment consists of 50 questions and should take approximately 30 minutes to complete. Your responses will generate a probability score for selling your business. The score indicates how sellable your business is from a BUYER’S perspective. Your score also indicates whether the price you will likely get will be on the low, mid, or high end of the valuation range. In fact, this step will suggest your listing price.
Upon completion, our advisory team offers recommendations for improving your score. You will also receive a written report on your results. At this point, we can also prepare a written opinion of value should you wish to proceed with offering your business for sale.
If you are happy with your score and the price your business should be listed for, great! If selling is your objective, your advisor can discuss an M&A engagement and start the process right away. We will be on the same page with respect to probability, valuation, and likely time frame to conclude a successful transaction.
If you are unhappy with your score and the valuation range for your business, you have the option of undertaking the relevant iREV modules that can help increase the probability of a successful sale, at a price range that meets your expectations. This preparation can seriously increase the likelihood of a successful sale by as much as 50%.
STEP 2: Choose and Complete Relevant iREV Modules
Completing Step 1 will inform you of which modules you should undertake before offering your business for sale.
Even if you scored high and want to list your business right away, you should at least take the Readiness to Sell Assessment. This exercise helps you pull together all the documentation that will be needed and ensure a smooth due diligence process with prospective buyers.
If you determine it would be wise to shore up the weaknesses surfaced by the Business Sellability Assessment and increase the chances of a successful sale at a higher valuation, you can undertake the relevant modules.
Each module consists of four parts:
1. Excellence Assessment – assesses and scores the selected department against criteria used by most buyer’s. The departments include product/service, market, sales, team, operations, financials, and legal/regulatory issues.
2. Discussion and Exercises – discuss with your advisor the results of the assessment and complete certain exercises that can help improve the fundamentals of the department.
3. Recommendations and Action Items – receive actionable recommendations from your advisor and a schedule for making the improvements. It is common to assign some of these action items to the appropriate members of your team.
4. Implement the Recommendations and Retake the Excellence Assessment – after implementing the recommendations, retake the excellence assessment to see how much it improved the department.
STEP 3: Ready to Sell!
After completing the relevant modules, you will be more prepared to sell your business than the vast majority of entrepreneurs who undertake an M&A effort. The likelihood of a successful outcome that meets your expectations will have increased by as much as 50%. At this point, we work together to:
- Enter into an M&A Engagement Agreement.
- Agree on the NDA form prospective buyers must sign before getting details on your opportunity.
- Write the teaser.
- Write the Confidential Information Memorandum.
- List the business on the appropriate Business Brokerage Multiple Listing Services and M&A Exchanges.
- Develop a target list of 50-100 acquirers and initiate contact with the appropriate decision-makers.
- Set up a secure, virtual data room for the exchange of information.
- Begin entertaining Indications of Interest (IOI’s).
iREV Time Commitment
How much time and effort you want to devote to each module is up to you. You can complete one module each week, or one module each month. Some of the action items to improve revenue, earnings and valuation will take longer to implement than others.
Don’t rush it if you don’t have to! Devote sufficient time and resources to improve your business and adequately prepare for your exit, BEFORE listing it for sale.
There is no cost and no obligation for the Business Sellability Assessment. It’s our contribution to the success of all business owners, whether they want to improve the business for a future exit, sell the business themselves, or get it ready to transfer to their hand picked successors.
There is no cost for the Opinion of Value and Readiness to Sell Assessment, for business owners who engage one of our licensed advisors to help REV and sell the business.
For business owners and their teams who want to undertake any of the iREV modules, they are typically priced on a per module basis, according to the billing rate of each advisor.
THE iREV MODULES
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Disclosure: iREV is a business advisory system. It does NOT sell businesses. iREV’s affiliated advisors are licensed to sell businesses and they operate under their own trade names.