© 2014 Exit Planning Institute The Exit Planning Process Overview of The Exit Planning Process...

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The Exit Planning Process• Overview of The Exit Planning Process• Assessing transition Readiness• Basics of Business Valuation• Introduction to Value Enhancement • Financial Planning for Business Owners• Exit Options Analysis• Implementation – Next Steps

Instructor:

Chris Snider, CEPAPresident & CEOExit Planning Institute Aspire Plus USA(216) 392-4801csnider@aspiremanagementinc.com

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Exit planning is the conscious effort to

maximize enterprise value while enabling the

conversion of that ownership into personal financial freedom and

peace of mind.

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Maximizes the value of the business

Ensures you are personally and financially prepared

Ensures you have planned for the third act of your life

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An Exit Plan addresses all of the…

Business Personal Legal Financial, and Tax issues

involved in operating a privately owned

business

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Exit Planning Institute’s State of Owner Readiness Survey 2013

• 2/3rds are not familiar with all exit options• 78% have no formal transition team; 83% have no written

transition plan; 49% have done no planning at all• Less than 7% have a formal life after plan• 40% have no plans in place to cover illness, death or

forced exit• 1/2 feel ownership transition plans require the company to

remain profitable for plans to be properly executed, yet 86% have not taken on a strategic review or a value enhancement project

• 56% felt they had a good idea of what their business is worth yet only 18% have had a formal valuation in the last two years.

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DeathDisabilityDivorceDistressDisagreement

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Owners are leaving $ on the table because they are focused on income generation;

not focusing on enterprise valueIncome does not automatically translate

to valueMost businesses are not salable and do

not make it through the second generation

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“Age Wave” First boomers turned 65 in 2011; 10,000 turn 65

everyday; the youngest are now 50. Own 63% of the private businesses in U.S. 80-90% of their wealth is tied up in their businesses EPI recent survey confirms: 75% plan to transition

over the next 10 years; 48% in the next 5 years Represents a transfer of 4,500,000 businesses and

over $10 trillion of wealth

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© 2014 Exit Planning Institutewww.exit-planning-institute.org

Third Act Goals and Objectives Personal Purpose Lifestyle S.T.E.P.

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Focuses on Value Acceleration vs. Income Growth Starts with an Assessment and

Valuation – i.e. Current State Roadmap and Benefits: Personal & Business Deliver in 90 Day Sprints De-Risk First Accountability and Re-Calibrate Every 90 Days Grow or Exit? Delay the Decision Time and Money?

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Step Min. Period

1. Prepare exit plan 6 months – 1 year

2. Build value and complete tax planning 1 year or more

3. Investment banking/sales process 1 year

4. Transition process 1 year or more

Total Time 3.5 years or more