Question 1

How much is my business worth?

Accepted Answer

The value of your business is typically determined by applying an industry-specific EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) multiple to your adjusted earnings. For middle-market businesses in Oklahoma, Texas, and the Southwest, multiples typically range from 3x to 7x EBITDA depending on your industry, growth trajectory, customer concentration, and operational efficiency. Use our AI-powered business valuation calculator for a preliminary estimate, or schedule a confidential consultation with our team for a detailed analysis.

Question 2

When is the right time to sell my business?

Accepted Answer

The optimal time to sell aligns when three factors converge: you are personally ready to exit, your business is performing well with strong financials (ideally showing growth over the past 3-5 years), and market conditions are favorable with active buyer demand and reasonable interest rates. Most business owners start planning too late. We recommend beginning exit planning 2-3 years before your intended sale to maximize value and ensure a smooth transition.

Question 3

How long does it take to sell a business?

Accepted Answer

A formal investment banking sell-side process typically takes 6-12 months from engagement to closing. This includes 2-3 months for preparation and marketing materials, 3-4 months for buyer outreach, management presentations, and due diligence, and 2-3 months for negotiation and closing. Complex transactions involving regulatory approvals, earnouts, or multiple bidders may extend this timeline.

Question 4

How do I prepare my business for sale?

Accepted Answer

Successful exit preparation involves several key steps: clean up your financial statements and ensure they tell a coherent story, document all systems and procedures to reduce owner dependency, organize a full data room with contracts, employee records, and corporate documents, address any legal or environmental issues, and build a strong management team that can operate without you. Ideally, start this process 2-3 years before selling.

Question 5

What happens to my employees after I sell my business?

Accepted Answer

Employee treatment varies by buyer type and transaction structure. Strategic acquirers often retain key employees to maintain operations and customer relationships. Private equity buyers typically invest in management teams and may offer equity incentives. During negotiations, we advocate for employee protections and transition plans that align with your values.

Question 6

What does an investment bank do when selling a business?

Accepted Answer

An investment bank serves as your strategic advisor and advocate throughout the entire sale process. We prepare full marketing materials (Confidential Information Memorandum), identify and approach qualified strategic and financial buyers, manage the data room and due diligence process, negotiate deal terms and structure to maximize your proceeds, coordinate with attorneys, accountants, and other advisors, and create competitive tension to drive up your sale price.

Question 7

What is the difference between a merger and an acquisition?

Accepted Answer

In a merger, two companies combine to form a new entity, typically involving stock exchanges and shared governance. In an acquisition, one company purchases and absorbs another, with the acquiring company maintaining control. Most middle-market transactions are structured as acquisitions, where a buyer purchases 100% of your company's stock or assets.

Question 8

How do investment banks find buyers for my company?

Accepted Answer

We leverage multiple channels to identify the best buyers for your business: our proprietary database of strategic acquirers and private equity firms, industry research to find competitors and adjacent players who would benefit from your capabilities, our network of relationships built over years of transactions, and targeted outreach to qualified prospects. We create a competitive auction process with multiple interested parties.

Question 9

What is an EBITDA multiple and why does it matter?

Accepted Answer

An EBITDA multiple is the ratio of a company's enterprise value to its EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization). For example, if your business generates $2 million in EBITDA and sells for $10 million, the multiple is 5x. EBITDA multiples vary significantly by industry, company size, growth rate, and market conditions.

Question 10

What valuation methods are used in M&A transactions?

Accepted Answer

Investment banks use several valuation approaches: comparable company analysis (comparing to similar public companies), precedent transaction analysis (analyzing recent M&A deals in your industry), discounted cash flow analysis (projecting future cash flows and discounting to present value), and asset-based valuation (for asset-heavy businesses). For most middle-market transactions, EBITDA-based valuation using comparable transactions is the primary method.

Question 11

What factors increase my business valuation?

Accepted Answer

Key value drivers include: consistent revenue growth (10%+ annually), strong EBITDA margins compared to industry peers, diversified customer base with no single customer over 10-15% of revenue, recurring or contractual revenue streams, experienced management team that can operate without the owner, proprietary technology or processes, strong market position or competitive moat, and clean financial records with audited statements.

Question 12

How much do investment banks charge to sell a business?

Accepted Answer

Investment banking fees for middle-market M&A transactions typically include a modest monthly retainer during the engagement period and a success fee calculated as a percentage of the transaction value at closing. Success fees generally range from 2-5% for deals between $10 million and $100 million, with the percentage decreasing as deal size increases. This fee structure aligns our interests with yours.

Question 13

What is seller financing and should I offer it?

Accepted Answer

Seller financing occurs when the seller provides a loan to the buyer to cover a portion of the purchase price. While not always necessary, offering seller financing can expand your buyer pool, demonstrate confidence in the business, and often results in a 10-15% higher sale price. Typical terms include 60-70% financed over 5-7 years at 6-10% interest.

Question 14

What are the tax implications of selling my business?

Accepted Answer

Tax treatment varies significantly based on deal structure (stock vs. asset sale), your business entity type, state of residence, and personal circumstances. Generally, asset sales result in higher taxes for sellers but benefit buyers, while stock sales are more tax-efficient for sellers. Strategies like installment sales, qualified small business stock exclusions, and charitable planning can reduce tax liability.

Question 15

What industries does First Turn Capital specialize in?

Accepted Answer

First Turn Capital specializes in middle-market M&A advisory for blue-collar and industrial businesses across the Southwest and Central United States. Our core industries include manufacturing, oilfield services, construction and infrastructure, transportation and logistics, HVAC and mechanical services, crane and hoisting, equipment rental, healthcare services, and agriculture.

Question 16

What size companies does First Turn Capital work with?

Accepted Answer

We focus on middle-market companies with annual revenues between $5 million and $100 million and EBITDA between $1 million and $15 million. This sweet spot represents businesses too large for business brokers but often overlooked by large Wall Street investment banks. Our clients are typically founder-owned or family businesses ready to explore exit options, recapitalization, or growth capital.

Question 17

What geographic areas does First Turn Capital serve?

Accepted Answer

While headquartered in Oklahoma City, we serve clients across the Southwest and Central United States, including Oklahoma, Texas (Dallas-Fort Worth, Houston, Permian Basin, Texas Panhandle), New Mexico, Kansas, Arkansas, Missouri, Colorado, Louisiana, and Arizona.

Question 18

How do I get started with selling my business?

Accepted Answer

The first step is a confidential conversation with our team to understand your goals, timeline, and business situation. We offer complimentary initial consultations where we discuss your objectives, provide preliminary market insights, and explain our process. If we're a good fit, we'll propose a formal engagement including a thorough valuation analysis and go-to-market strategy.

Question 19

What documents do I need to sell my business?

Accepted Answer

A full data room typically includes: 3-5 years of financial statements (ideally audited or reviewed), tax returns, customer and revenue breakdowns, employee roster and organizational chart, key contracts (customers, suppliers, leases), corporate documents (articles, bylaws, operating agreements), insurance policies, equipment lists, intellectual property documentation, and any pending litigation or environmental matters.

Frequently Asked Questions

Selling Your Business

M&A Process

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