Customer Reviews

Exiting Your Business, Protecting Your Wealth: A Strategic Guide for Owners and Their Advisors

5 star:		(4)
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3 star:		(1)
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1 star:		(0)

 

 

If you own a business, you need to read this book. Even if you aren't thinking of selling or exiting any time soon, this insightful book will help you think about your business as an investment, instead of as a job. You will know what the final "play" looks like...so you can make the decisions NOW to get there. Far from being a stuffy legal treatise, it is a practical how-to manual that lays out the options and provides real life scenarios that make them come to life. I highly recommend this book!

Marcia Bench, Purposeful Entrepreneur Success Coach (and former business lawyer)

I liked this book a lot. It has an Introduction and 15 chapters divided into the following three parts or sections:

I. Preparing for your exit
II. Knowing your options
III. Planning your exit

I thought the book was well written, well outlined, and full of good content. It was written by an attorney who advises clients on how to clean up their businesses so they can be sold or handed down to the owner's offspring.

Creating a successful business is an uphill battle for many. And what the definition of a successful business is depends on who you ask. A small business that provides a job for its owner/operator whereby that person earns $150,000 a year in taxable income very well might be considered successful. But what would happen if that person died? Would the business still bring the subsequent owner $150,000? Maybe, maybe not!

What this book covers is the arsenal of issues that one must consider if they have a small business they want to either retire from and sell out profitably, or pass down to their offspring or other relatives. A business that is really an alterego of its owner is not worth all that much. And such businesses are hard to sell for a nice sum. In those instances, when the centerpiece of the company moves on, then so does the revenue stream. Not a good thing when you want to sell a business.

Another book I read that kind of touched on the issues in this book was "Instant Systems" (ISBN: 9780071466707). The point is that if you don't systematize your business, then you won't have anything to sell. And "Exiting Your Business" is about selling your business or passing it on to relatives.

This book not only includes exiting strategies regarding the sale of the business to another company, the company's employees, or some rich individual. But also covers estate planning and tax planning issues, too. It's really a well though-out and extensive book on its subject. 5 stars!

PS. Take a look at the Search Inside feature that Amazon provides for this book. There you can examine the Table of Contents and see for yourself what exactly is covered.

I would recommend this book much more for a business owner than for an experienced advisor. As someone with a strong merger & acquisitions transaction structuring background I found the book to be very rudimentary. While Leonetti does a good job of outlining various exit strategies, the book is more a high level overview than an in-depth description with detailed examples of various ways that an advisor can structure an owners exit. In the instance that Leonetti compares the exit options of selling for highest price, recapitalizing 80% to a private equity group and remaining as 20% owner/operator or establishing an ESOP, he grossly overstates the potential of the private equity recap by applying an expected ROI on invested capital based on high leverage to an unlevered ownership interest. As well, he does not address the risks involved in holding on to a 20% position. Private equity groups apply a portfolio strategy to their investments and typically many investments do not meet expected returns. The big winners tend to compensate for small losers.

Also Leonetti omits, what I believe to be a key concept of exits for C-corps, which is the concept of carving out personal goodwill from the C-corp in the case of an asset sale. All owners of closely held C-corps and their advisors should understand this concept. In many cases when an owner has developed key customer relationships the IRS will allow a portion of the goodwill to be personal goodwill and not corporate goodwill so the owner of a C-corp can aviod double taxation on the personal goodwill portion. In my opinion this is a very important part of exiting from a C-corp if the owner does not wish to convert to a flow through entity and wait 10 years for the favorable tax treatment. As well there are other ways to avoid double taxation in asset sales such as allocating purchase price to the non-compete which is also of a personal nature and not within the corporation.

Overall a fairly comprehensive overview missing a bit of the meat I would like to see.

I am Certified Exit Planning Advisor and a colleague of John's who also helps business owners grow and harvest their entrepreneurial wealth. I loved his book. It is the most comprehensive approach to the subject that I have read. Every business owner who hopes to one day sell his/her business needs to read this book- and to get started now to implement his advice. I don't recall John actually saying this, but I know he would agree with me when I say that the business owner needs to run his/her business every day as though he plans to leave it tomorrow, no matter what exit strategy he has in mind. Buy the book now. It is well worth the investment of your time and money.

There comes a time when one must leave what they have worked on for so long. "Exiting Your Business, Protecting Your Wealth: A Strategic Guide for Owners and Their Advisors" is a guide to extracting oneself from one's business. An exit strategy for business is needed, in order to keep one's own prosperity as well as that of the businesses. With special chapters on realizing when one is a workaholic, moving onto a different career or retiring, and setting realistic exit goals, "Exiting Your Business, Protecting Your Wealth" is a must for business owners who want to move on.