CaptBeach
01-05-2013, 05:07 PM
So the wife is getting worn down by the grind as am I...we started a small educational professional development company in 07...grossed 200K...up until that point we had been pretty much blue collar Joe and Josephine, paid cash to put 4 kids thru college, we learned our lesson with student loans...had a house and decent car...2.5 dogs and all the bills that go with it...prior to that we knocked down $125-150K a year between the 2 of us...by late 2007, early 2008 I had to quit my career to come home and help...shes tired of 75-80+ hour weeks and having all the responsibility of payroll and running the biz...I've tried to help where I can but 99% of it is greek to me (educatorese) but I handle the travel, logistics, trade shows yadayada...
6 year gross income is just a hair shy of $5,000,000, she has a second consulting company that grosses $100+K a year she calls her part time job...its work we get that doesn't fit into the business model for the main company
She wants to do the real work...the problem is scaling...we can scale the business we cant scale her...she has to be in a position to clone herself to scale and the workload we have prevents this...
We have a larger company that wants to do just that...basically what we are exploring is selling the company to them to take the workload of payroll, sales, scaling, logistics as they have a large sales staff and administrative staff to handle that and have her brought on as an employee or partner in this venture/division and her to teach them to scale and expand exponentially. We did $5m in sales with virtually no advertising or marketing. The $$$ basically sought her out...she is in the top .01% of her field in the world in her expertise. Recognized by US DOEd, nearly every university and school system in the country and all over the world. I think we have decided to sell on the notion of lowering her workload tremendously and being able to come out from under the stress of it all...we'd love to stick it out but the load of scaling/growing is taking its toll...the first 2 year we did it alone...now we have $300-350K in payroll per year and $60K in qtrly IRS payments after its all said we aren't making the kind of $$$ we could if we were larger more efficient company with sales staff, admin and marketing...pretty sure the company considering buying us could see $7-10M in gross sales inside 3 years and double that in the following years...
Our accountant floated the Gross Sales per year divided by years in business x 3 model as an asking price...shes been wrong more than once...
We also want to negotiate a salary for her x 3 years as this is the amount of time it would take to completely scale into their business. Along with a lease for her apartment as this is 3 states away from our home which we are not going to sell. She also wants travel expenses back and forth to home on a bi monthly basis. AND we are asking for 25% cut of future gross sales for the years she is with them and 10% thereafter plus a yearly consulting fee...
Are we on the right track here?
Of the WT members in medium to larger size businesses who here has sold a company like this? input?
We are pretty good at business but have never sold something like this...
Capt Beach
6 year gross income is just a hair shy of $5,000,000, she has a second consulting company that grosses $100+K a year she calls her part time job...its work we get that doesn't fit into the business model for the main company
She wants to do the real work...the problem is scaling...we can scale the business we cant scale her...she has to be in a position to clone herself to scale and the workload we have prevents this...
We have a larger company that wants to do just that...basically what we are exploring is selling the company to them to take the workload of payroll, sales, scaling, logistics as they have a large sales staff and administrative staff to handle that and have her brought on as an employee or partner in this venture/division and her to teach them to scale and expand exponentially. We did $5m in sales with virtually no advertising or marketing. The $$$ basically sought her out...she is in the top .01% of her field in the world in her expertise. Recognized by US DOEd, nearly every university and school system in the country and all over the world. I think we have decided to sell on the notion of lowering her workload tremendously and being able to come out from under the stress of it all...we'd love to stick it out but the load of scaling/growing is taking its toll...the first 2 year we did it alone...now we have $300-350K in payroll per year and $60K in qtrly IRS payments after its all said we aren't making the kind of $$$ we could if we were larger more efficient company with sales staff, admin and marketing...pretty sure the company considering buying us could see $7-10M in gross sales inside 3 years and double that in the following years...
Our accountant floated the Gross Sales per year divided by years in business x 3 model as an asking price...shes been wrong more than once...
We also want to negotiate a salary for her x 3 years as this is the amount of time it would take to completely scale into their business. Along with a lease for her apartment as this is 3 states away from our home which we are not going to sell. She also wants travel expenses back and forth to home on a bi monthly basis. AND we are asking for 25% cut of future gross sales for the years she is with them and 10% thereafter plus a yearly consulting fee...
Are we on the right track here?
Of the WT members in medium to larger size businesses who here has sold a company like this? input?
We are pretty good at business but have never sold something like this...
Capt Beach