Shoot the Moon with Revenue Rocket

Adjustments to EBITDA and Valuation based on Owner Comp

Episode Summary

Owner compensation can have a major influence on deal structures and overall valuation. Not only the implications of off-setting owner comp within EBITDA calculations but the fundamental upside and walk away money a seller may realize at close. In this episode the guys dive into the different scenarios we come across and how we navigated the trading of these variables before, during and after a business combination.

Episode Notes

Scenarios discussed in this episode:

• Taking yourself out of the business
• Staying in the business at above-market comp
• Addressing spouses or children in the business
• What to expect post-close: consulting agreement, employment agreement
• Adjusting to life after a change in income and receiving cash at close