Website w/ Portal for Hiring & Staffing
This software as a service is a popular online tool that offers an efficient recruitment process with applicant tracking, automated applicant messaging, and a robust resume database. Additional recruiter features include screening questions, reporting, and talent sourcing. The accessible price point for services is very beneficial to companies looking to streamline their hiring process. For career seekers, the easy-to-use platform features advanced search engines, simple resume uploads, and a user login to store submissions and communications.
The current location is owned by the organization, but new office space could be leased for a simplified transition. Employees working for the company can move with the company, or the software as a service could be absorbed into a current operation.
- Years in Business: 25+
- Location: Midwest
- Customer Service Area: Regional: 90%; National: 10%
- User Service Area: Regional: 80%; National: 20%
- Clients: Small to large businesses looking to acquire talent as well as individual job seekers
- Product: Software, website & portal for hiring
- Services: Post a position, applicant tracking, resume database, social media integration, find a position search engine, resume posting
- Lease: The company owns the building it currently occupies, and space is potentially available for lease on a different floor, for an easy transition or a new owner can easily relocate.
- Reason for Selling: Selling a profitable division of the operation
- Employees: 10: Manager (1), Web Developers (3), Sales (6)
- Hours: M-F: 8:00-5:00
- Seller Training Period: 3-6 months
- Growth Opportunities: Much room for growth, advertise to reach new customers, improve SEO, build additional customer relationships, maximize additional services and tools to increase interest, educate customers on additional features
- Current Owner’s Responsibilities: Passive
- List Price: $4,050,000
- Gross Sales:
- 2019: $1,747,470 Annualized
- 2018: $2,024,457
- Cash Flow:
- 2019: $927,113 Annualized
- 2018: $847,754
- Assets Included in Purchase*
- A/R: $900,000 as of 12.3.18
- Intangible Assets: Excellent regional brand recognition, 25+ year reputation, ready for expansion
*amounts may vary month to month
Cash Flow Analysis
|Description of Financial Statement||P&L Statement|
|P&L Statement||P&L Statement||P&L Statement||Notes|
|Net Income Shown on Financial Statement||$424,927||$847,754||$1,478,448||$1,275,397|
|Seller's Cash Flow = Total Addbacks + Net Income||$424,927||$847,754||$1,497,582||$1,295,300|
|Profit Margin||53.05 %||41.88 %||50.22 %||35.33 %|
- This product has not been the focus of the business, but sales and subscriptions would be greatly impacted by a concentration of efforts on sales and marketing.
Typical Clients and Services
- Small to large businesses
- Single listing
- Selection of Services:
- Job posting
- Automated messaging
- Applicant tracking
- Screening questions
- Talent screening
- Individual user
- Selection of Services:
- Search engine
- Position applications
- Personal account to save searches and submissions
- Resume upload
Specific information regarding clients is available upon the receipt of a signed Non-Disclosure Agreement.
Total Employees: 10*
- Manager (1)
- Web Developers (3)
- Sales (6)
* Employees working for the company can move with the company, and/or the software as a service could be absorbed into a current operation.
Much room for growth!
- Advertise to reach new customers
- Improve SEO
- Build additional customer relationships
- Maximize additional services and tools to increase interest
- Educate customers on additional features
- Add new functionalities to the service
The Firm used a cash flow valuation methodology to determine the purchase price of the business.
The formula used is as follows:
Cash Flow x Prescribed Multiple = Fair Market Value
Cash flow is the sum of business net income plus any owner perks and any non-onward going expenses.
A multiple is prescribed by a 20 question, 100-point parameter ranking system that is used to analyze the current business health. Each question is based on a scale from 1 to 5: 1 being low, 2 below average, 3 average, 4 above average, 5 high. The average of the responses sum is the business’ prescribed multiple.
For this business, a 3 year average cash flow was used with a prescribed multiple is 3.75. With this information, the computation is as follows:
$1,090,816 x 3.75 = $4,090,560
The fair market value found above positions the business list price at $4,050,000.
Purchase Price: $4,050,000
12.5% Buyer Down Payment: $475,000
20% Seller Financing: $760,000
67.5% Bank Loan: $2,565,000
Seller financing 5-year term at a rate of 4.50% equals a monthly loan payment of $14,169.
Bank loan 8-year term at a rate of 6% equals a monthly loan payment of $33,708.
After business expenses and loan payments, a buyer with a 12.5% down payment of $475,000 would retain a profit of $516,295, which results in a 108% return on investment in the first year.
A lender is required to have a minimum 1.5 coverage ratio for any business loans extended. At a proposed purchase price of $4,050,000 with the terms listed above, the coverage ratio is 1.9.
Please note that the decision of whether to extend a loan on any sale belongs to the bank, and this document does not guarantee specific terms or verify that financing is available.
Offer Price: $
% Buyer Cash Down at Closing: $
% Seller Carry Back via Promissory Note: $
year term at a rate of %
% of Purchase Price secured by Buyer and Seller
Total Bank Loan Need: $
% of Purchase Price
Desired Loan Type:
Desired Bank Terms: year term at a rate of %
Total Business Assets, Inventory, and A/R: $
Total Undercollateralized Loan: $
|Monthly Payment to Bank:||$|
|Yearly Payment to Bank:||$|
|Monthly Payment to Seller:||$|
|Yearly Payment to Seller:||$|
|Total Monthly Debt Service:||$|
|Total Yearly Debt Service:||$|
Fixed Charge Coverage Ratio
The bank will require a minimum ratio of 1.5 to be lendable.
2018 Cash Flow
|Annual Debt Service:||$|
Buyer's Net Operating Income (NOI)
The amount of money the Buyer will retain as profit.
2018 Cash Flow
|Annual Debt Service:||-$|
Buyer's Return on Investment (ROI)
The rate of return on the Buyer's down payment.
|Document Title / Description|
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