I agree. I think you have to write up what a buyer "could make" from your
network ; not necessarily what you are making.
That was done for us a few acquisitions ago to help us "see" what we were
buying.
Truth be told, we weren't really looking to sell. We were looking for some
partners on a project or two and one company
who looked at us made us an offer. We hadn't even figured up an asking price
yet. This was a sticking point that came up.
I would say negotiations are still ongoing.
----- Original Message -----
From: Tyson Burris
To: AnimalFarm Microwave Users Group
Cc: memb...@wispa.org
Sent: Monday, January 6, 2020 11:24 AM
Subject: Re: [AFMUG] Company Valuation
I disagree.
Revenue minus expenses is profit. Finding a WISP who expenses correctly can
be difficult. Even I pull my hair out on all the expenses and various ways you
can expense items.
Profit times X is the selling price.
I was just speaking with my wife about this and complaining about how high
our profit margins are. The more profits the more taxes paid.
So ideally you want to expense out as much as possible, take dividends, pay
yourself more etc. so profits aren't high.
The problem is a buyer wants to see your profits so it's a nightmare of a
fine line. Taxes vs. Selling.
Tyson Burris, President
Internet Communications Inc.
739 Commerce Dr.
Franklin, IN 46131
Daytime # 317-738-0320
Cell/Direct # 317-412-1540
Online: www.surfici.net
What can ICI do for you?
Broadband Wireless - PtP/PtMP Solutions - WiMax - Mesh Wifi/Hotzones - IP
Security - Fiber - Tower - Infrastructure.
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From: AF <af-boun...@af.afmug.com> On Behalf Of CBB - Jay Fuller
Sent: Monday, January 6, 2020 10:08 AM
To: af@af.afmug.com
Cc: memb...@wispa.org
Subject: [AFMUG] Company Valuation
Lets say for easy math purposes you bill approximately 1.5 million annually.
I've heard 1.5 times annual revenue thrown around for a valuation purpose.
There is a lot more to this figure but it's a place to start.
So, if your company billed 1.5 million, you'd say your valuation was around
$2.25 million.
If you had 90 towers on your network - and you owned 60 of them (the steel,
not the land they're on) , would you consider your network
worth more than if you rented all 90?
My take on this is yes, they could all be taken down and converted to cash,
so the fact we own towers vs. rent them makes our network
more valuable.
What say you?
Thanks.
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