Mark at the Chicago Wispnog Charles put on, there was a couple investors that bought and sold wisps. We had a session on it. The way they described the valuation of a wisp brought the price down well under 1x yearly revenue. More like 6 months of revenue cash buyout. They picked everything apart and devalued based on what ever they could find.

And there was a couple of wisps who sold their operation for about 1x yearly. One guy said the buyer wanted some of his commercial subs and took the whole thing and even hired him and another seller said he wanted to toss in the towel after fighting with the telco, get a law degree and donate the rest of his life to fighting the telco's I seem to remember that he sold for under 1x with some cash now and paper. Both of these guys were 802.11b wisps. And I think both are still on some of the wireless lists. You might want to ask on the isp-wireless list or part-15 list as well.

Seems that wisps with contracts to their customers and a network of Alvarion, Trango, Canopy or similar was more appealing and had a higher value.

Maybe this is helpfull.

How many subs do you have?

George







Mark Nash wrote:
Thanks Marlon... For the record, it's not a rough split between me and my partner. He's got a more profitable business going, he's put up money for the wireless business, he's 53 and going to retire when he's 55, so he wants to focus on his other business. That's what I would do if I were him. The money he put in is easy to account for and pay back, but he has also put in a considerable amount of unpaid time and he'd like to realize some benefit from that, and I should honor that in the split. Makes sense. So I'm trying to figure out what's reasonable to offer for his part in all of this.

Mark Nash
Network Engineer
UnwiredOnline.Net
350 Holly Street
Junction City, OR 97448
http://www.uwol.net
541-998-5555
541-998-5599 fax
----- Original Message ----- From: "Marlon K. Schafer (509) 982-2181" <[EMAIL PROTECTED]>
To: "WISPA General List" <wireless@wispa.org>
Sent: Thursday, April 27, 2006 3:45 PM
Subject: Re: [WISPA] Business Value


Hi Mark,

I don't have time to get into the deep details right now. I can probably help with this if you'd like. I've done some valuations based on income, customer base etc.

Standard business stuff would put your company value at 1.2 to 2x annual earnings. OR 3 to 5 x annual profit (probably not much of that if you're growing well).

With a wisp, it gets more complicated because most wisps are growing fast and are just starting to get into the profit mode. So the value of the company won't even hit most guys for a couple more years. shrug

I've also seen WISPs get paid for the number of homes passed in addition to the above.

The last valuation I did I took the number of customers possible on the hardware installed, cut that down to more reasonable numbers (100 users per ap), figured a moderate growth rate (max of 4 per day after 3 years) and came up with an expected customer base in 36 months. That's the point that I put a value on the company. I used 1.5x annual earnings. At this point the company would have been HUGELY profitable though. (started out with 1 install per day, ramped that up by 1 every 6 months or so) *I* think I had a reasonable growth rate (market size was nearly 1,000,000 people much of which had NO broadband) and left room for several competitors to gain market share.

On a partnership breakup it gets more difficult. No one probably has any money (or they'd not be fighting so much in the first place). One guy usually put up all the funding and the other one did all of the work. There are hard feelings and often friendships on the line. In those cases about all you can do is to take the income today and use that for the value. Or one partner can agree to go silent and let the other one carry on with business. Tough stuff either way.

Hope that helps. Feel free to call if you'd like to talk it over some more.
Marlon
(509) 982-2181                                   Equipment sales
(408) 907-6910 (Vonage)                    Consulting services
42846865 (icq)                                    And I run my own wisp!
64.146.146.12 (net meeting)
www.odessaoffice.com/wireless
www.odessaoffice.com/marlon/cam



----- Original Message ----- From: "Mark Nash" <[EMAIL PROTECTED]>
To: "WISPA General List" <wireless@wispa.org>
Sent: Thursday, April 27, 2006 7:31 AM
Subject: [WISPA] Business Value


I may be splitting with my partner in the coming months. We'll have to come up with a buy-out agreement. Has anyone got experience with valuating WISP
businesses?

Mark Nash
Network Engineer
UnwiredOnline.Net
350 Holly Street
Junction City, OR 97448
http://www.uwol.net
541-998-5555
541-998-5599 fax


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