Cash is king. And the borrower is servant to the lender. Just saying. It's always better to just get it over with when you can.
> On Mar 20, 2014, at 7:32 AM, "Hass, Douglas A." <[email protected]> wrote: > > You and I are on the same page here. > > The short answer to those on this list: > > If your business attorney or CPA is telling you “Always do cash deals” or > “Never use seller financing,” then thank them for their time and find someone > else to advise you who is comfortable advising sellers on a full range of > options, guiding them to the best ones, and is including the right > protections for you. > > > The longer answer: > > Here’s why we’re on the same page. The first question is not “Is the offer > 100% cash?” but “Why am I selling?” The second question is “What do I want > out of the sale?” That’s what you’re doing below. > > A couple people have expressed concern about getting the business back if > something goes wrong. There are many ways to structure that deal so as to > greatly minimize the time or expense of getting the business back, as I’ve > mentioned elsewhere. > > Your concern is getting out entirely. There are many ways to structure that > deal. 100% cash is one way to do it. Another that I mentioned during the > course of this is through an annuity (which you have the option of selling to > get cash or keeping to get the higher payments, according to your risk > tolerance). You can do sweep accounts where the bank guarantees that you get > paid first as money comes in coupled with business insurance options. The > deal structure that might work best for you will depend first on your goals > as a seller, second on your buyer, and finally on your risk tolerance. > > Saying “I’ll only take 100% cash” is definitely an option, and sometimes the > best one, but it’s never the only one. If you have an advisor locking you > into an all-cash deal, that’s a sign that he or she may not be the best > advisor for you. I’ll even bet that they’re probably missing things even in > that all-cash deal they’re drawing up for you. > > If anyone here on the list ever wants some confidential guidance on how to > structure a deal, language to put in an agreement, or about sales/purchases > generally, I’m happy to help share what I can and get you pointed to the > right advisor (attorney, CPA, whoever) to help (and I’ll be happy to > contribute to the employment piece of whatever deal you do). > > Doug > > > From: [email protected] [mailto:[email protected]] On > Behalf Of [email protected] > Sent: Thursday, March 20, 2014 12:27 AM > To: WISPA General List > Subject: Re: [WISPA] Selling ISP > > I had a meeting a couple weeks ago with a company looking to buy us. They > have deep pockets and were looking at cash only deal. If I'm looking to sell, > it's obviously because I want to go in a different direction. The last thing > I'd want to do is go through the enter sale process only to have to take the > company back at a later date. Even if I was able to get my company back > immediately months later with zero customer loss, the time, effort and lost > growth just aren't worth the risk in my opinion. > > > On Wed, Mar 19, 2014 at 5:09 PM, Hass, Douglas A. <[email protected]> wrote: > Primary housing is a different deal altogether. Unlike businesses, where you > can get immediate repossession, you often can’t with housing. > > From: [email protected] [mailto:[email protected]] On > Behalf Of CBB - Jay Fuller > Sent: Wednesday, March 19, 2014 4:02 PM > > To: WISPA General List > Subject: Re: [WISPA] Selling ISP > > > Then why do people sell houses on owner financing ? > > Sent from my Verizon Wireless 4G LTE Smartphone > > ----- Reply message ----- > From: "Justin Wilson" <[email protected]> > To: "WISPA General List" <[email protected]> > Subject: [WISPA] Selling ISP > Date: Wed, Mar 19, 2014 3:50 PM > > > Having been a part of a deal gone bad I recommend cash up front. > Once you hand over the keys it’s pretty hard to get it back. If you have to > go to Litigation you are going to be spending money out of pocket for > attorneys. I agree with Cameron. Cash at closing. If you don’t do 100% > cash at closing you should be prepared to not see another dime if you do > anything else. > > I know ISPs who sold, got some money at closing, and then ended > up spending twice that money on attorney fees and still ended up with > nothing. Selling a business should be like selling a high dollar item. If I > was going to sell a car I sure wouldn’t sell it on contract. Too many > things can go wrong. > > If I had 100% ownership in an ISP today and wanted to sell I > would take a hit on the overall price. If then user couldn’t afford it and I > really needed to sell for whatever reason I would simply take a lower price. > Less stress that way. > > Justin > > > -- > Justin Wilson <[email protected]> > MTCNA – CCNA – MTCRE – MTCWE - COMTRAIN > Aol & Yahoo IM: j2sw > http://www.mtin.net/blog – xISP News > http://www.zigwireless.com – High Speed Internet Options > http://www.thebrotherswisp.com – The Brothers Wisp > > > > From: "Hass, Douglas A." <[email protected]> > Reply-To: WISPA General List <[email protected]> > Date: Wednesday, March 19, 2014 at 3:08 PM > To: WISPA General List <[email protected]> > Subject: Re: [WISPA] Selling ISP > > Cameron— > > There’s lots of ways to structure the deal so that you’re protected, even if > the buyer is a complete imbecile and even if the buyer doesn’t have cash up > front. If you want to sell or if you want to buy, don’t let the all-cash > restriction prevent you from making a deal. If you end up in court chasing > payments from the buyer, then you likely didn’t draft your agreement > carefully enough given your tolerance for risk (of course, your due diligence > should be telling you whether the buyer is an imbecile, and that information > should inform what kind of deal you’re willing to accept). > > To categorically reject buyers who don’t have 100% cash to hand you at > closing might mean leaving money on the table or more flexible terms from > someone who can put together a more attractive end package. In that sense, > it works like selling real estate. The all-cash offer isn’t always your best > one. > > To Randy’s point--Jab has undergone a major shakeup at the top. Many of the > senior executive staff have departed in the last few months. That might > account for some of the quietness. I don’t have any inside information, just > what I learned trying to round up potential panelists and speakers for > WISPAmerica. > > Doug > > From: [email protected] [mailto:[email protected]] On > Behalf Of Cameron Crum > Sent: Wednesday, March 19, 2014 1:45 PM > To: WISPA General List > Subject: Re: [WISPA] Selling ISP > > The seller is not a bank. Why should they take on all the risk? What happens > if the buyer is a complete imbecile and runs the network into the ground and > defaults on payments? Now you are in court suing for money you will most > likely never see, and even if you retake possession of the network, it may be > in shambles or most of your customers have left. We walked away from a couple > of buyers who would not pony up the cash. I'd say as one who sold a wisp, if > the buyer can't afford it, or can't arrange their own financing, you don't > want to sell. > > > On Wed, Mar 19, 2014 at 1:39 PM, Mike Hammett <[email protected]> > wrote: > There's many more buyers out there. > > > > > ----- > Mike Hammett > Intelligent Computing Solutions > http://www.ics-il.com > > From: "Randy Cosby" <[email protected]> > > To: "WISPA General List" <[email protected]> > Sent: Wednesday, March 19, 2014 11:00:34 AM > > Subject: Re: [WISPA] Selling ISP > > Is anyone actually buying right now? I haven't heard much about the big > buyer (Jab) lately. > > > On 3/19/2014 9:49 AM, CBB - Jay Fuller wrote: > > The going rate, we've seen (and has been discussed here many times), is about > 1.5x annual revenue > > Douglas A. Hass > Associate > 312.786.6502 > [email protected] > > Franczek Radelet P.C. > Celebrating 20 Years | 1994-2014 > > 300 South Wacker Drive > Suite 3400 > Chicago, IL 60606 > 312.986.0300 - Main > 312.986.9192 - Fax > www..franczek.com > > Franczek Radelet is committed to sustainability - please consider the > environment before printing this email > Circular 230 Disclosure: Under requirements imposed by the Internal Revenue > Service, we inform you that, unless specifically stated otherwise, any > federal tax advice contained in this communication (including any > attachments) is not intended or written to be used, and cannot be used, for > the purposes of (i) avoiding penalties under the Internal Revenue Code or > (ii) promoting, marketing or recommending to another party any transaction or > tax-related matter herein. > For more information about Franczek Radelet P.C., please visit franczek.com.. > The information contained in this e-mail message or any attachment may be > confidential and/or privileged, and is intended only for the use of the named > recipient. If you are not the named recipient of this message, you are hereby > notified that any dissemination, distribution, or copying of this message or > any attachment thereto, is strictly prohibited. If you have received this > message in error, please contact the sender and delete all copies. > ----- Original Message ----- > From:Eagle One Wireless > To:'WISPA General List' > Sent: Wednesday, March 19, 2014 10:33 AM > Subject: Re: [WISPA] Selling ISP > > We priced ours at 2.5x gross revenue. We had about 10 companies contact us. > I would say 5 were serious but they wanted us to finance it so we decided > not to sell. > > Thanks, > > Kevin Melson > Eagle One Wireless > 1505 Hwy 72 E > Corinth, MS 38834 > 662-287-1722 > [email protected] > www.e1w.com > > > > > -----Original Message----- > From: [email protected] [mailto:[email protected]] On > Behalf Of Ryan Morgan > Sent: Wednesday, March 19, 2014 10:30 AM > To: [email protected] > Subject: [WISPA] Selling ISP > > What is the current rate for selling your ISP! I would like to sell, for > health reasons. > Thanks for your help! > Jean > _______________________________________________ > Wireless mailing list > [email protected] > http://lists.wispa.org/mailman/listinfo/wireless > > > ----- > No virus found in this message. > Checked by AVG - www.avg.com > Version: 2014.0.4336 / Virus Database: 3722/7216 - Release Date: 03/19/14 > > ----- > No virus found in this message. > Checked by AVG - www.avg.com > Version: 2014.0.4335 / Virus Database: 3722/7208 - Release Date: 03/17/14 > > _______________________________________________ > Wireless mailing list > [email protected] > http://lists.wispa.org/mailman/listinfo/wireless > > > _______________________________________________ > Wireless mailing list > [email protected] > http://lists.wispa.org/mailman/listinfo/wireless > > -- > Randy Cosby > InfoWest, Inc > 435-674-0165 x 2010 > --- > This e-mail message contains information from InfoWest, Inc > and is for the sole use of the intended recipient(s) and may > contain privileged, proprietary or confidential information. > > Unauthorized use, distribution, review or disclosure is > prohibited. 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