Capital

Can you generate enough capital for growth?

Can you leave enough behind to run the business?

Getting Capital

One of the hardest things to do in life is to stay where you are. You either grow or you shrink.

It's a lot more fun working in a business that's growing, isn't it? When you grow, you create more opportunities for employees to prosper and advance. You keep your good employees a lot more easily. You make more money to reinvest into doing things even better for customers.

But what do you do if present earnings haven't generated the investment capital to grow the way you know you can, or to keep ahead of competition, or to pay off a fellow owner that wants to cash out? It's rare for earnings to generate these kinds of returns, by the way, or ROIs wouldn't be expressed as a percent!!!

Many small businesspeople struggle with the ability to generate capital to significantly grow a business. That is particularly difficult right now in a tough economy and a credit market that is squeaky tight.

Today they want to see solid earnings history and forecasts, cash flow history and assets that can be liquidated quickly in order to justify lending candidates. If you can't present a good picture of these, then you need to get busy.

Maximize Profitability

If you have an ongoing business, we can help you sharpen your strategy, maximize profitability and accelerate cash flow in order to be more attractive to lenders and investors.

Write a Professional Business Plan

We can help you to develop, enhance or promote a solid strategic business plan, the true value of collateral in your business and your future earnings potential. Here's what we would generally include

Passing on Capital

Many small businesspeople are stunned when they hear that upon death of a single spouse, their estate could end up paying 45% to 55% tax to the IRS on the net value of their taxable estate. The Estate Tax is computed as follows:

Want to see what your estate taxes might be?

Estate Tax Calculator

What if An Owner Wants To Retire, Take Some Money, But Leave The Business To The Family?

Private Equity firms make it possible for owners to do this without crippling the company. They actually look for this kind of situation, but they want to make sure the firm is adequately managed.

You also want your company to fetch the highest price, because taking this route is just like selling the company. In fact, private equity companies do extensive "due diligence" to arrive at the true value of your company, and often totally recapitalize it with a combination of their equity, loans and possibly some of your equity. Most of the value is based on true future earnings potential and a target return on equity for the investor company.

So, you will have to prepare your successors well to manage the company's strategy and operations. It is also a good idea to fix any weaknesses in your company and put your best foot forward with a professional business plan presentation and prospectus before contacting candidates. Shamrock can help you to achieve those goals and navigate you through the process.

To get an idea of what firms like this look like, follow the links to these companies.

Mountain View Capital

Heritage Partners, Inc.

Ways to Reduce Estate Taxes

Gifting

You can reduce the amount of assets that are subject to taxes by gifting amounts to relatives up to certain maximum amounts. These amounts are limited you need to start early. There are other implications, such as whether you will make gifts of stock with voting rights or without voting rights.

Trusts

You can set up a "bypass trust" where you effectively preserve your spousal transfer rights even though a spouse has died. This must be set up prior to the death of the first spouse and the assets must be transferred immediately to the surviving spouse.

Although we have the knowledge and experience to know when you need estate planning assistance and how critical it may be, Shamrock has relationships with tax accounting and legal professionals to assist you with your estate planning needs.