Business Valuation: It’s Not...

Business Valuation: It’s Not Just for Succession Planning

This insight was written by our partner Libro Credit Union. An original version of the blog can be viewed here.

Often when people think of business valuation, the process of measuring the current value of a business, they relate this to succession planning. I’ll be honest, I was guilty of this too.

Traditionally, business valuations are a moment in time, a singular exercise. Recently, Libro partnered with a Canadian software company, interVal, who changes the way we think about valuation. To put it simply, the interVal platform turns traditional viewpoints about valuations on their head. Instead of a single, point-in-time analysis, the interVal platform gives both business Owners and Libro Coaches an on-going way to monitor, discuss and leverage valuation data to drive better results. Approximately 98% of small business owners in Canada don’t know the actual value of their business and what’s influencing it, until far too late in their ownership journey.

As a Senior Relationship Manager and Coach, it’s my job to help our Libro business Owners succeed. When our Owners can use automation tools like interVal to help understand the impact of their daily decisions on their business, Libro’s role in their business journey becomes more impactful. With access to real-time and dynamic valuation data, business owners can make more educated decisions, without having to guess about how it might impact the short and long-term value of their business. Knowing your business value ‘now’ is critical when charting a course for your future and this platform gives you reports to help you stay on track and adjust when needed.

I was talking with Adam Gianotti, CPA, who recently joined interVal as Director of Partner Enablement, and I was impressed with his passion around the importance of monitoring valuation data. According to Adam, “Small and midsize businesses represent over 90% of the business population in North America. No matter how you slice it, these companies are responsible for a large number of jobs and economic contribution. Unfortunately, these same businesses often find themselves settling for sub-par advisory services from their institutional partners. By partnering with interVal, Libro has shown an incredible commitment to ensuring the long-term prosperity of their Owners.” During his 10+ years as an accountant, Gianotti saw firsthand how valuation analysis can empower businesses with the data they need to make better decisions.

Each Owner may have different perspectives on what their business value means to them. For example, those that are closer to succession or sale may value interVal differently than an earlier-stage business. I feel confident in saying that all businesses have the potential to leverage their business’ value. This tool not only helps them measure that value, but also the factors influencing it, comparing it to historical trends and industry benchmarks. My favourite part as a Libro Coach is working with my Owners, using the data produced by interVal, to help them get the most out of their business.

Business owners work with Libro because of our promise to put purpose before profit, to truly understand your business needs, and to help you develop a plan to succeed.