Equity Value Enhancement
There is a striking dichotomy between management of privately-held and publicly-traded businesses regarding the focus on underlying equity value. With privately-held companies, it seems that so much management effort is exerted to achieve short-term or single year operating results, that little attention is paid to equity value enhancement.
Equity or owner value is the single performance metric that maximizes overall company efficiency and allows all business stakeholders to optimize their positions within the company’s operational parameters. For many privately-held business owners, the value of their company equity is the most significant asset in their investment portfolios.
All too often, the value of this equity interest is not what the owner expects. Unfortunately, the reality of the lower value is not usually identified until the date of sale, when it is too late to do anything to increase value. As a result, the owner must face a retirement or post-sale lifestyle that does measure up to his/her anticipated standards.
The Business Valuation & Litigation Support Services Group at Grossman Yanak & Ford LLP can assist business owners in understanding how managing equity value can enhance long-term net worth. More importantly, we can help to identify the value drivers within your business and develop and implement value enhancement strategies to grow the value of your business. These strategies are specific to each business as well as the owner’s goals and exit timeframe. In theory, planning for value enhancement is no different than trying to maximize the value of any other asset. The significant advantage in a privately-held business is the ability to directly control the process.
Do not let another year pass without focusing on increasing the value of your business!