This document discusses key considerations for buying or selling a small business. It provides an overview of panelists with relevant expertise in business transition planning, taxation, and valuation. The panelists discuss the importance of succession planning to protect against involuntary transitions and maximize business value. They note many business owners fail to plan ahead. A three circle model of prioritizing family, business, and ownership group is presented. All businesses will transition, so planning for voluntary succession inside or outside the family is crucial. Timing, recurring revenue, and a self-sufficient business model are three pillars to create a valuable, sale-ready company. Maintaining social, intellectual, and financial capital is critical to long term success and transition.

1. 1
Buying or Selling a Small Business?
What You Need to Know

2. Buying or Selling a Small Business?
What You Need to Know
November 2, 2016

3. 3
Today’s Panelists
HOST: Shelley Ng, Ceridian
• Vice President of Product Management for small and midsize
businesses
• Uses customer feedback to develop and implement new business lines
• Tracks industry trends and helps customers capitalize on new
developments
MODERATOR: Stuart Ducoffe (LLB, CHRP) e2r®
• Founder of e2r Solutions and partner and co-founder of Woolgar VanWiechen
Ketcheson Ducoffe LLP
• Practices employment and labour law exclusively
• Certified by HRPA as a Certified Human Resources Professional (CHRP)
• Worked with one of Canada’s largest and most prestigious Canadian law firms

4. 4
Today’s Panelists
Sean Foran, CIBC
• Managing Director of Business Transition Planning
• Provides advice on market values for private companies, as well as the optimal
tax and legal structure for businesses in transition
• Co-author of Succession Stories from the Front Line
• Estate and Trust lawyer with 20+ years working with business owners
• Director & Practice Leader, Business Transition Services
• Fourth generation to work in family’s firm
• Expertise in business strategy, value enhancement, succession
development
• 20+ years experience helping business families, private companies and
not-for-profits deal with transition
Jeff Noble, BDO Canada LLP

5. 5
Today’s Panelists
Charlotte Burke, Microsoft
• Vice President for small to medium businesses
• 25+ years experience leading high growth private and public technology companies
• Former executive in residence with the BDC Advantage and Venture Capital Groups
• Over 15 years serving as corporate director on public and private boards
• Mentor at MaRS and the Next 36 helping early stage companies commercialize their
businesses
Nunzio Presta, BizON
• CEO of BizON, an online marketplace where people can buy, sell and grow
businesses or franchises
• Thought leader on digital marketing and entrepreneurship through
acquisition
• Mentor to many entrepreneurs

6. 6
Agenda
Trends and impact of succession planning
Urgency for planning next phase of your business
Best practices in quantifying and building the value of your business
Taxation considerations
Preparing yourself and your employees for post-sale

7. 7
Many Business Owners Fail to Plan Ahead
25%
Currently have a succession plan to address the day when they are no
longer able/willing to run the operation*
Succession planning remains
stuck at the bottom of most
people’s agendas
Business owners are
focused on actions
and strategies to
secure long-term
success
What is more long-term
than the transition of
the business?
* BDO survey

8. 8
Three Circle Model
Family
BusinessOwners
Family well-being
A cohesive ownership group
with a common vision
A profitable and successful
business
Insight from Sean Foran, CIBC

9. 9
Every Business WILL Transition
Plan for a voluntary transition
Inside the family / business
VOLUNTARY
Lifestyle changes
Retirement
INVOLUNTARY
Death / Disability
Disagreement / Divorce
Decline in profitability
Protect against an involuntary transition
Outside the family / business
Insight from Jeff Noble, BDO

10. 10
Storm clouds,
failures
Good times,
good returns Slow death,
memories
Time
Business
Value
All Businesses Go Through This Cycle Over Time
Insight from Jeff Noble, BDO

11. 11
Rejuvenation; new
blood, new ideas,
different thinking;
M&A
Time
Business
Value
A New Cycle Can Begin – Timing is Critical
Storm clouds,
failures
Good times,
good returns
Slow death,
memories
Insight from Jeff Noble, BDO

12. 12
Time
Business
Value
A Revitalized, Larger, Growing Business Can Emerge
Good times,
good returns
Storm clouds,
failures
Rejuvenation;
new blood, new
ideas, different
thinking; M&A
Insight from Jeff Noble, BDO

13. 13
The Trajectory
Liquidity
Relinquish Control
Management
buyout
Strategic
sale
Private equity
(control)
Recapitalization
(minority)
Debt
recapitalization
Data Insight from BizON Incorporated - mybizon.com

14. 14
3 Pillars to Creating a Valuable Business for Sale
TIMING
RECURRING
SELF-
SUFFICIENT
GrowthSeamless
Sustainable
Financial
Reward
Data Insight from BizON Incorporated - mybizon.com

15. 15
Critical Success Factors
Build All 3 Types Of Capital
SOCIAL
Maintain the culture and enhance
the legacy via a strong
connection with employees,
customers, family and
community
• Mission, Vision, Values
• Culture of Engagement
• Individual/Family Reputation
• Community, Philanthropy,
Environment, etc.
INTELLECTUAL
Identify and mentor successors
(internal & external)
• Skills/Competencies
• Experience/Wisdom
• Product Knowledge
• Relationships/Reputation
FINANCIAL
Provide for the financial
independence and lifestyle of
retiring and future owners

16. Q & A

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