Learn the 6 steps of buying or selling a business, how to evaluate the potential value of a business before offering to purchase, and how to prepare and market a business for sale when Michael Balstad, certified exit planning advisor and founder of Bizleavable LLC joins SBDC director, Kelly Bearden on this week’s free webinar. 

Bearden begins the webinar with a look at key business-related updates and available capital resources. 

This marks the 359th episode of the “Webinar Wednesday” business series that provides news and information helpful to employers and business owners. 

The CSU Bakersfield SBDC provides free one-on-one help to small business owners. New and existing businesses can go to https://csubsbdc.com/ for more information or to sign up to meet with a business advisor at no cost. 

TIMESTAMPS

00:00 Intro

00:40 What’s up today September 17, 2025

03:23 Capital Corridor – The EIDL Advantage for the Borrower

10:00 The EIDL Advantage for the Seller

11:00 A Sample Transaction – Buying a Business and Assuming EIDL

12:00 Sample Transaction – Buying a Business with No Money Down SBA EIDL Assumption Requirement Letter https://www.sba.gov/document/support-assumption-requirement-letter

13:14 Economic Corner – Fed Cuts Interest Rates

13:42 NextTech Kern 2025 at CSU Bakersfield on Thursday, October 2 – AI in Business, AI in Academia, AI in Security https://www.csub.edu/nexttechkern/

15:04 Local Success Story featured at the National ASBDC conference in Florida

https://csubsbdc.com/client-story/ten-moore-books/

https://www.haileymoore.net/abouttheauthor

16:35 Subscribe to our CSUB YouTube Channel @csubsbdc

17:43 Kelly introduces Michael Balstad, Certified Exit Planning Advisor Bizleavable, LLC https://www.bizleavable.com/

18:41 Michael begins to speak

19:58 Six Steps to Selling Your Business

22:05 Step 1 – Preparing a Small Business for Sale

27:47 Step 2 – Marketing – how to get your business that’s for sale in front of a ready, willing and able marketplace that may have an interest in acquiring it

29:34 Marketing and Lender Considerations

30:18 How lenders assess risk and buyer viability, emphasizing cash flow and documentation readiness. Confidential marketing and due diligence limit information until an NDA is signed

30:46 How listings show cash flow, gross sales, and business descriptions, and where listings appear on marketplaces; negotiations span price, financing, and seller transition support

32:44 Marketing Platforms https://www.bizbuysell.com/ https://www.franchisegator.com/ https://www.bizben.com/

34:24 Step 3 – Negotiate All Deal Points – Price, financing terms (e.g., seller financing, down payment), and seller’s transition assistance – Seller assistance can range from a week to up to one year for SBA deals

40:06 Step 4 – Final Due Diligence -Buyers review of financials, taxes, legal issues, lease transferability, assets (and exclusions), and regulatory risks

43:26 – Seller’s due diligence – Assess buyer’s track record, industry experience, management/entrepreneurial experience, credit, reputation, and motivations

45:00 Step 5 – Legal Documents – Assemble the accepted contract of sale and all exhibits (supporting documentation from due diligence) – The business enters escrow, and documents are executed by relevant parties

45:58 Step 6: Transfer of Ownership – Funding is wired from buyer/lender to seller, closing escrow.

-Transfer trade accounts, insurances, leases, internet accounts, marketing assets, and customer lists.

-Facilitate meetings with employees and customers to introduce the new owner and ensure a smooth transition.

– Determine seller’s involvement timeline (up to one year for SBA deals)

49:11 Five Stages of Value Maturity

52:51 Importance of protecting value through five D’s—death, disability, divorce, distress, disagreement

1:03:51 Four Value-Driving Cs – Types of Capital: Human, Social, Customer, Structural

1:09:26 Mission, Vision, and Organizational Health – Clear distinction is made between mission/vision and product. Engaging employees stems from a unifying mission and vision. Engaged employees are more productive, by about 30%, and that culture should align with long-term goals

1:17:03 Evaluating the Three Gaps that Stand in Your Way – Wealth Gap: Insufficient income/assets outside the business to meet long-term financial needs

1:18:42 Profit Gap: Difference between current profit performance and best-in-class profit performance

1:20:30 Value Gap: Difference between current company value and best-in-class value

1:23:44 Two Acronyms You Need to Know – SDE and EBITDA

1:25:49 Seller’s Discretionary Earnings – SDE – Add backs are items that increase a business value due to owner-specific decisions. – The concept is illustrated with a family member salary and discretionary expenses

1:27:00 Earnings Before Interest, Tax, Depreciation, Amortization EBITDA – Used for managed businesses where the owner is not involved in daily operations – Focuses on the pure financial performance of the business – Examples are provided to show how non-core expenses and owner-related payments are treated as add backs.

1:29:16 Buying an existing, well-run business is often lower risk than starting from scratch, especially if the product/service is not a new innovation or unavailable in the area. – Existing businesses have proven track records, customers, profits, and immediate paychecks

1:30:24 Maureen joins Michael for Questions and Answers with webinar attendees