Financial Goals Decision Tree

Many business owners are unsure of the best way to monetize their companies to reach their financial goals. The Bridgepoint Decision Tree can help give a clearer picture of the options and outcomes. Just choose whether your goal is Capital or Liquidity, then click through to see the PROs and CONs. Try it a few different ways to find the best solution for you and your company.

CLICK ON THE OPTION THAT FITS YOUR GOAL

MY GOAL IS LIQUIDITY FOR
  • Partial or full monetization
  • Exit or succession planning
  • Transition to next generation or management team
MY GOAL IS CAPITAL FOR
  • Elimination of personal guarantees
  • Organic growth and/or acquisitions
  • Buyout of other shareholders

You chose Liquidity. Now click on the next option that best suits your goals

DO YOU WANT TO RETAIN CONTROL?

YES - I'D LIKE TO
  • Have majority owner retention
  • Have operational freedom
  • Plan for next generation involvement in the business
NO - I'D LIKE TO
  • Maximize proceeds
  • Shift majority ownership
  • Step back from operations

You chose Capital. Now click on the next option that best suits your goals

DO YOU WANT TO RETAIN CONTROL?

YES - I'D LIKE TO
  • Have majority owner retention
  • Have operational freedom
  • Have less governance over the business
NO - I'D LIKE TO
  • Accelerate growth
  • Maximize proceeds
  • Be situated for significant acquisition

You chose Liquidity with Retaining Control. Here are the options that best fit your chosen goal, along with some PROs and CONs to consider.

OPTION 1

DEBT RECAPITALIZATION OPTION

PRO – Owner(s) will receive a significant cash dividend while maintaining 100% ownership of the company ownership of the company

PRO – Low amortization (2%-5%) will enable higher flexibility and investment in company growth

PRO – Owner(s) will gain a partner who can provide strategic guidance and additional capital for growth and/or liquidity

CON – The Company will incur increased debt or leverage

CON – The Company will experience increased financial reporting requirements

OPTION 2

MINORITY EQUITY RECAPITALIZATION OPTION

PRO – Owner(s) will maintain both ownership and operational control of the company

PRO – Owner(s) will continue to participate in the company’s financial growth and subsequent deals or acquisitions

PRO – Owner(s) will gain a partner who can provide strategic guidance and additional capital for growth and/or liquidity

CON – The Company will experience increased debt or leverage

CON – The Company will experience increased financial reporting requirements

CON – The Company will experience increased governance

BRIDGEPOINT IS HERE TO HELP YOU REACH YOUR GOALS

We have the Wall Street experience and the Main Street values that make us a knowledgeable and trusted partner in achieving your financial objectives. Please feel free to contact our advisors for a confidential discussion. We look forward to hearing from you.

You chose Liquidity with Retaining Control. Here are the options that best fit your chosen goal, along with some PROs and CONs to consider.

OPTION 1

MINORITY EQUITY RECAPITALIZATION OPTION

PRO – Owner(s) will maintain the autonomy to operate the Company vs. having a strategic sale

PRO – Owner(s) will continue to participate in the company’s financial growth and subsequent deals or acquisitions

PRO – Management team will receive equity incentives

PRO – Next generation of management can participate in the rewards of keeping the business going and/or growing

PRO – The Company will gain a partner to provide strategic guidance and additional growth capital

CON – Owner(s) will undergo loss of ownership control

CON – The Company will experience increased debt or leverage

CON – The Company will experience increased financial reporting requirements

CON – The Company will experience increased governance

OPTION 2

SELL TO A STRATEGIC ACQUIROR

PRO – Owner(s) will receive maximize valuation and proceeds

PRO – Owner(s) will gain an increased certainty of closing

CON – Owner(s) will incur loss of control for the preservation of the family’s legacy

CON – Continuity of the Company’s management after the transaction will be uncertain

OPTION 3

EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)

PRO – Owner(s) will receive tax advantages

PRO – Existing management team will be ensured continuity and operational control after the transaction

CON – Owner(s) will likely be unable to maximize valuation or proceeds from a sale to an ESOP

CON – Transaction structure typically includes seller financing, which spreads the receipt of proceeds over time

CON – Requires ongoing administrative costs, including valuation, legal and trustee fees

BRIDGEPOINT IS HERE TO HELP YOU REACH YOUR GOALS

We have the Wall Street experience and the Main Street values that make us a knowledgeable and trusted partner in achieving your financial objectives. Please feel free to contact our advisors for a confidential discussion. We look forward to hearing from you.

You chose Capital with Retaining Control. Here are the options that best fit your chosen goal, along with some PROs and CONs to consider.

OPTION 1

DEBT RECAPITALIZATION OPTION

PRO – Owner(s) will receive a significant cash dividend while maintaining 100% ownership of the company

PRO – Low amortization (2%-5%) will enable higher flexibility and investment in company growth

PRO – Owner(s) will gain a partner who can provide strategic guidance and additional capital for growth and/or liquidity

CON – The Company will incur increased debt or leverage

CON – The Company will experience increased financial reporting requirements

OPTION 2

MINORITY EQUITY RECAPITALIZATION OPTION

PRO – Owner(s) will maintain both ownership and operational control of the company

PRO – Owner(s) will continue to participate in the company’s financial growth and subsequent deals or acquisitions

PRO – Owner(s) will gain a partner who can provide strategic guidance and additional capital for growth and/or liquidity

CON – The Company will experience increased debt or leverage

CON – The Company will experience increased financial reporting requirements

CON – The Company will experience increased governance

BRIDGEPOINT IS HERE TO HELP YOU REACH YOUR GOALS

We have the Wall Street experience and the Main Street values that make us a knowledgeable and trusted partner in achieving your financial objectives. Please feel free to contact our advisors for a confidential discussion. We look forward to hearing from you.

You chose Capital Without Retaining Control. Here is the option that best fits your chosen goal, along with some PROs and CONs to consider.

OPTION

MINORITY EQUITY RECAPITALIZATION OPTION

PRO – Owner(s) will maintain the autonomy to operate the Company vs. having a strategic sale

PRO – Owner(s) will continue to participate in the company’s financial growth and subsequent deals or acquisitions

PRO – Management team will receive equity incentives

PRO – Next generation of management can participate in the rewards of keeping the business going and/or growing

PRO – The Company will gain a partner to provide strategic guidance and additional growth capital

CON – Owner(s) will undergo loss of ownership control

CON – The Company will experience increased debt or leverage

CON – The Company will experience increased financial reporting requirements

CON – The Company will experience increased governance

BRIDGEPOINT IS HERE TO HELP YOU REACH YOUR GOALS

We have the Wall Street experience and the Main Street values that make us a knowledgeable and trusted partner in achieving your financial objectives. Please feel free to contact our advisors for a confidential discussion. We look forward to hearing from you.

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