The value of child care buildings and land (commercial real estate) often involves considering many things, including capitalization rates, often referred to simply as cap rates. In short, a cap rate reflects the risk associated with the property investment. It is also a projection/estimate of the rate of return the investment will provide. In commercial…
Most independently owned child care businesses either got started with an SBA (Small Business Administration) backed (meaning backed by the US government) loan – a 7(a) loan or 504 loan, or have used an SBA loan to remodel, expand, or build a new child care center. For several reasons, including the lower down payment and…
When selling a childcare business, as part of the Asset Purchase Agreement (the business sale contract), the business buyer may request that a portion of the childcare business seller’s proceeds from the sale be held, usually in an escrow account, for a specified period after the transaction closes. The buyers’ requests for a funds holdback…
Having worked as a child care business mergers and acquisitions advisor since 1995, I know that when a child care owner contacts me, they are often interested in selling their child care business. One of the primary things they would like to know is its value. Knowing the value is key when considering the sale…
Introduction Planning your exit from your childcare business is a critical phase in your lifecycle as an entrepreneur. A well-thought-out exit strategy ensures the business’s continuity and maximizes the value derived from years of hard work. Exit planning involves preparing for the eventual ownership transition, which requires careful consideration and strategic planning. Understanding Exit Planning…