• By Achille Ekeu, MBA, CVA

Families own or control 90 percent of businesses in the United States. But according to the Family Business Forum at the University of North Carolina in Asheville, 30 percent make it into the second generation (Success), 12 percent, into the 3rd generation (Headline) and only 3 percent into the 4th generation (Dynasty). Due to poor planning, preparation and communication between siblings, brothers and sisters of a family, ugly valuation fights arise sometimes that affect the value of the family business.

Specific Characteristics of Family Companies

  • 80 percent of family businesses have between 20 and 499 workers, with sales ranging from $5 millions to $30 Millions.

  • Family-owned businesses with 20 or less workers employed 20.2 million Americans whereas those with 21 to 499 workers employed over 55 millions Americans.

  • Family owned businesses generate 64 percent of the nation’s gross domestic product, however only 30 percent have succession plans and less than 40 percent have a successor lined-up.

  • Family finances are too tied to business success.

  • Two-third of family businesses don’t require family members to have the qualifications or related experience to be successful when entering the business.

  • Nearly half of America family businesses are operating without a written strategic plan.

  • 75 percent of family owned companies have a board of directors, an advisory board, or both, that guide them when making strategic decisions.

Family Businesses Face Big Issues

  • It is estimated that 40.3 percent of family business owners expect to retire, creating a significant transition of ownership in the US. Less than half of those expecting to retire in five years have selected a successor.

  • Nearly half of family business owners (43 percent) have no succession plan in place.

  • Even though nearly 70% of family businesses would like to pass their business on to the next generation, only 30% will actually be successful at transitioning to the next generation.

  • A majority of family businesses (60 percent) believe that their ethical standards are more stringent than those of competing firms. They also report ethical standards being discussed often or always at meetings with employees, in discussions with customers and during board meetings.

How Families Hurt the Value of Their Businesses

The failure to plan for succession in a family business is more often than not the root cause of many issues that threaten the value and future of their businesses. Some of those issues include:

  • No succession planning

  • Strong owners can be weak at leadership development

  • No strict rules govern family members coming into the business or back into the business

  • The next generation is not trained to play nicely

  • Families can be resistant to change, and so can their companies

  • No formal compensation structure exists

  • Family conflicts inside and outside the company

  • And more…

All these issues affect the valuation of their businesses; therefore the value of these companies may not be as high as the owners think. The simple reasons are that they do not follow best practices for their industry, and their finances and business strategies are not in the best of shape.

Achille Ekeu, MBA, CVA

President/CEO

The Washington Valuation Group (WVG)

Achille Ekeu is a Certified Valuation Analyst (CVA) member of the National Association of Certified Valuators and Analysts (NACVA) in the DC-MD Chapter. He provides valuation services for Estate and Gift Tax, Purchase, Sale of business, Debt Financing, Buy-Sell Agreements, and Litigation Support in Divorce/Shareholders disputes cases. He can be contacted by phone at 240-274-9570 or by email at achille.ekeu@washingtonvaluation.com.

#Appraisal #BusinessAppraisal #Valuation #BusinessValuation

  • By Achille Ekeu, MBA, CVA

Here is a testimonial from recent clients (father and son), Robert Wheeler and his son Robert C. Wheeler, owners of Tranz Global, Inc. located in Falls Church, VA. They contacted the Washington Valuation Group for the valuation of their company few weeks ago. They provided us with all the documents we needed. We did the valuation and submitted our report. They were very satisfied and agreed to give us their opinions of our work.

Here is another testimonial form another recent client, Bishop Ode Hines, CEO of FaithCanon, Inc. located in Boca Raton, Florida, who contacted The Washington Valuation Group for a valuation of their new social media platform for Christians. They provided us with their business plan, we helped them with their financial projections and did the valuation of their start-up. We submitted our report and had a video conference call with all the Board Members of the company located in various cities around the World. Bishop Hines was very satisfied and agreed to share his experience working with us.

Those are some of our recent clients who where willing to share their experience with us on video. Many others sent us written statements that you can read on our Testimonials Page.

We want to take this opportunity to Thank all our clients and particularly those who agreed to share their opinions of our work with the public. Thank You!

For anyone looking to get their business valued, please contact us at 240-274-9570 or at achille.ekeu@washingtonvaluation.com.

#Appraisal #Valuation #BusinessAppraisal #BusinessValuation

  • By Achille Ekeu, MBA, CVA

The News broke yesterday that the National Association of Certified Valuators and Analysts (NACVA) has chosen Achille Ekeu, President and CEO of The Washington Valuation Group (WVG), to receive it's fourth Quarter 2018 Outstanding Member Award. Click Here to read more.

This is a great recognition and validation of the outstanding work Achille Ekeu has been doing since he joined NACVA in 2013. NACVA is the preeminent organization in the World that trains and certifies business valuation Experts. NACVA is The Authority in Matters of Value.

The Washington Valuation Group (WVG) is pleased and honored by this Prestigious AWARD and would like to Thank Parnell Black, The CEO of NACVA, Brien K Jones, the COO of NACVA, Jonathan Jackson, The Executive Director of NACVA and the entire NACVA organization for supporting it's members like no other organization does. We are humbled and embolden to continue to fulfill NACVA's vision, mission and goals.

In his recent message titled: Why Membership is NACVA to the organization, NACVA's CEO, Parnell Black, says:

"Foremost on my mind is we want to be the perfect association for our members.

We strive constantly to do so and with that, continue to improve our service and support."

Thank You Parnell, for being true to your words. We are grateful for your impeccable leadership and vision for this outstanding and amazing organization.

Our Successes Last Year

As a newly Elected Board Member sitting on the Valuation Credentialing Board (VCB) , I had the opportunity to interact with Parnell Black and other VCB Board Members during our monthly meetings, and found them to be Excellent, Exceptional and simply Amazing people to work with.

As the State Chapter President of Maryland/DC, Elected in December 2017 with other State Chapter Board members: Courtney Moore (Vice-President), Neil Eisgruber (Treasurer) and Angela Dmitrieva (Secretary), we had an outstanding year 2018 that began by recognizing some of our Chapter members who are highly involved in helping the Association achieve its vision, mission and goals. An Award ceremony was organised in September 2018 at the Doubletree by Hilton Hotel in Columbia, Maryland to recognize the following members:

  • Christopher Kyanko (Former State Chapter President)

  • Robert Carter (Former State Chapter President and Standards Board Member)

  • Gregory Caruso (Former State Chapter President and Current Editor-in-Chief of Around The Valuation World)

  • Ronald Rudich (Board Member sitting on the Litigation and Forensics Board) and last but not least

  • Alan Zipp (Board Member sitting on the Standards Board)

We also systematized how we select our Chapter Speakers to make the process more efficient and fair to the State Chapter Board and our Chapter members.

We ended the year with the "Launch Your Career In Business Valuation" seminar at the KOGOD School of Business at American University on October 16th, 2018 from 4:00pm to 6:00pm. The event was organized in partnership between NACVA Headquarters lead by our COO Brien Jones, and American University, lead by Finance Professor Octavian Ionici, PhD. We noticed a huge interest in the Business Valuation Profession from students who participated in that seminar.

Finally as the President and CEO of the Washington Valuation Group (WVG), and thanks to our clients, partners, and those who referred many clients to our firm last year, we had our best year yet with a 30 percent revenues growth last year compared to 2017. We've expanded our services to include Core Value Discover as our consulting platform. Our objective of becoming the go-to valuation firm in the Washington Metro Area is getting closer to be achieved as attested by the growing number of organizations requesting business valuation seminars from us:

  • Montgomery County Chamber of Commerce,

  • The Prince George's County Economic Development Corporation (PGCEDC),

  • The Financial Services Corporation - First (FSC-First),

  • Others...

and participants (mostly business owners) to those seminars getting more educated in the value of getting their businesses valued regularly to track the value creation happening in their organizations.

This Year

We look forward to an outstanding year 2019 and would like to invite you to:

  • refer us more business valuation clients,

  • invite us to organize business valuation seminars in your organisation,

  • share with your friends the value that The Washington Valuation Group (WVG) brings to start-ups, existing business owners, financial advisors, attorneys, consultants and others,

so we can all participate in growing our communities, cities and country.

Thank You and Happy New Year 2019!

#Appraisal #Valuation #BusinessAppraisal #BusinessValuation