First, a note from our President and Founder:

"November is here and it is the season of giving thanks. Though one newsletter is not enough to list all of those that we are thankful for this Thanksgiving, we want to share our genuine appreciation for all of you. I am thankful for my amazing team whose hard work and dedication have helped us reach so many of our company-wide goals for 2021. I am thankful for our wonderful clients as we would not be where we are today without you. I am also thankful to you, our newsletter family, for your continued interest in our news and services. We hope that you enjoy this wonderful time with your family and friends. Happy Thanksgiving."

- Justin Farmer, Esq., CBI

President & Founder of Private Practice Transitions

NEW PPT BLOG:

Valuing a Business: A Look at

Seller's Discretionary Earnings (SDE)

If you are in the process of selling or acquiring a small company, you have probably come across the term “Seller's Discretionary Earnings” or SDE. In essence, SDE is the foundation of business valuation for small businesses. It is a crucial concept that enables savvy buyers to gain a deeper understanding of a business’s story. Anyone looking to acquire a business wants to know two things: 

1. “How much money will I make from this business? 
2. “How do the price and earnings of this business compare to other similar businesses of the same size?” 

SDE comes in when answering these two questions. That said, let’s examine this often-misunderstood term and explain how you can recast the financials of a business to calculate its SDE. Continue reading our most recent blog, Valuing a Business: A Look at Seller's Discretionary Earnings (SDE).

Listing 1175

Established in 1993, this Bellevue tax and accounting firm has provided tax preparation and planning, and other accounting services to countless clients. The Practice’s service by revenue breakdown is 65% Tax Preparation & Planning and 35% Accounting Services. Over the past three (3) years, the Practice has averaged impressive gross revenue of approximately $862,560 (2018-2020). As of July 2021, the Practice is up 11% YoY as compared to July 2020, and it is expected that 2021 revenues will exceed 2020 revenues. The owner is willing to provide transition assistance and help with goodwill transfer, business development, and other “mentoring” functions for an agreed-upon period up to one (1) to two (2) years to ensure the new owner’s return on investment is realized. With ~700 loyal clients and proven YoY growth, this is one opportunity you don’t want to miss.

Listing 1178

Established in 1954, this CPA Practice has provided tax preparation and planning, and other accounting services to countless clients with a service by revenue breakdown of 35% Business Tax Preparation & Planning, 30% Individual Tax Preparation & Planning, 23% Bookkeeping and Payroll Services, 6% Estate Work, 3% Financial Statements and 3% Advisory. The Practice is owned by three partners, one of which is looking to retire. The remaining two Partners will stay on as 35% owners each, and they are looking for a third Partner to buy in at 30% ownership. The Firm is primarily located within Clackamas County, with small portions extending into neighboring Multnomah and Washington counties. The Practice is known for doing quality work and as such, has a great reputation within the community. Because of this, the Practice receives a lot of word-of-mouth referrals and has incredibly high client retention. As of September 2021, the Practice has already exceeded 2020 revenues with year-to-date gross revenues over $1,015,000. The retiring partner is willing to stay on as a consultant through the end of 2022 if desired. With impressive gross revenues and over ~1,030 active clients, this is a great opportunity for any buyer looking to buy into an already thriving business.

Listing 1179

For over 18 years, this busy Northeast Seattle tax and accounting practice has provided tax preparation and planning, and other accounting services to countless clients. The Practice’s service by revenue breakdown is 55% Tax, 42% CAS (Accounting, Bookkeeping, CFO), 2% Consulting and 1% Other. The Practice’s success can largely be attributed to its established name and loyal clients who have grown to trust the services it provides. The Practice has dedicated and tenured employees (three have been with the Practice since 2007) who provide outstanding service to their ~440 active clients. Over the past three (3) years, the Practice has averaged gross revenue of approximately $993,401 (2018-2020) and in 2020, the Practice brought in $1,061,411 in gross receipts. As of October 2021, the Practice has already exceeded 2020 revenues with year-to-date gross revenues of $1,061,433 (up 10.92% YoY). Including the Owner, the Practice has eight (8) staff. The Owner is an absentee owner, willing to stay on as a consultant for up to 1-2 years if desired. Don't miss this exciting business opportunity.

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