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Ownership Transfer Issues in the Sale of Professional Services Firms

Focus Investment Banking

Are you the owner of a Professional Services firm? The younger partners turned down the plan due to the risks involved, so an opportunity opened up for an entity backed by private equity to acquire the business. If so, congratulations. Did they risk losing everything by buying the controlling stake?

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How to Accurately Calculate Gross Margins (and Understanding Their Importance) at Professional Services Firms

Focus Investment Banking

If you’re considering the sale of your consulting or professional services business, you should understand that buyers will be examining your Gross Margin as an indicator of the value of your firm. Professional services companies make money by billing out their experts and consultants at rates higher than the employee cost.

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Earnouts: Sometimes a “Bridge” Too Far

Focus Investment Banking

But do earnouts consistently bridge the gap between buyers and sellers in Consulting and Professional Services deals? Despite the potential value at stake, the buyer balked at the idea of relinquishing control, envisioning strategic integration and synergy across their portfolio of Professional Services businesses.

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How to Calculate Cost of Goods Sold (COGS) for SaaS Companies w/ Examples

Software Equity Group

COGS is a key metric private equity investors and strategic buyers use to evaluate companies. How to Find Costs of Goods Sold Expenses to include in COGS are those directly attributable to the delivery of the goods sold by a company or the services provided. This includes their salaries.

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10 Concepts You and I Can Learn About M&A and Creative Deal Structuring From How2Exit's Interview With Roland Frasier Investor, Business Mentor and Strategist

How2Exit

However, many of these people find that they haven't built a sellable business and don't know how to professionalize it. By providing professional services, entrepreneurs can help these business owners make their businesses more sellable. Equity in exchange for value is a great way for both consultants and businesses to benefit.

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Will There Be an IPO for a Specialty Consulting Company in 2024?

Focus Investment Banking

And will that mean that some of the privately held management consulting firms or other professional services companies will choose an IPO this year? It has been some time since a professional services firm chose a public offering as a liquidity strategy. But those companies have been public for more than 20 years.

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What a Good Insurance Broker Looks Like

Focus Investment Banking

From FOCUS Investment Bankings experience in the market, certain traits consistently define high-performing, resilient firms traits that not only command premium valuations but also position sellers for successful transitions. They also improve working capital management and justify premium valuation multiples in the M&A market.

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