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Opportunities

Employment & Hiring Website w/ Portal

CASH FLOW
$927,113

Specifications

  • Price
    $3,800,000

  • Revenue
    $1,747,470

  • Profit Margin
    42%

  • Location
    Midwest

  • Service Area
    Customer Service Area: Regional: 90%; National: 10%

  • Reason for Sale
    Selling a profitable division

  • 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

  • Employees
    10: Manager (1), Web Developers (3), Sales (6)

  • Intangible Assets
    Excellent regional brand recognition, 25+ year reputation, ready for expansion

With over 25 years of experience, this well-established and comprehensive talent acquisition site is for recruiters and seekers a like.  With over 2,000 total business users and 100,000 sessions per month, this recognizable site is looking for a strategic buyer to encourage additional growth!  The team of 10, completes day-to-day operations with oversight from the owner.  Focusing on the national and regional markets, the product has outstanding potential for growth including opportunities for embedded advertising and additional recruiter functionalities. 

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.  

Business Highlights

  • 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 as a service for recruiting
  • 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

Financial Highlights

  • List Price: $3,800,000
  • 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 StatementP&L StatementP&L StatementP&L StatementP&L StatementNotes
2019201820172016
GROSS SALES$800,924$2,024,457$2,982,192$3,665,993
Net Income Shown on Financial Statement$424,927$847,754$1,478,448$1,275,397
ADDBACKS
Interest$0$0$19,134$19,903
TOTAL ADDBACKS$0$0$19,134$19,903
Seller's Cash Flow = Total Addbacks + Net Income$424,927$847,754$1,497,582$1,295,300
Profit Margin53.05 %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

Talent Acquisition:

  • Clients:
    • Small to large businesses
    • Subscription
    • Single listing
  • Selection of Services:
    • Job posting
    • Automated messaging
    • Applicant tracking
    • Screening questions
    • Reporting
    • Talent screening

 

Career Seeker:

  • Clients:
    • 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.

Employees

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. 

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 
  • Add new functionalities to the service

Valuation Details

The Firm Business Brokerage 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 2018 cash flow was used with a prescribed multiple is 4.5.  With this information, the computation is as follows:

$847,754         x          4.5       =          $3,814,893

The fair market value found above positions the business list price at $3,800,000.

Funding Example

Purchase Price:                          $3,800,000

15%Buyer Down Payment:      $570,000

15%Seller Financing:                $570,000

70%Bank Loan:                      $2,660,000

Seller financing 5-year term at a rate of 4.50% equals a monthly loan payment of $10,627.

Bank loan 8-year term at a rate of 6% equals a monthly loan payment of $34,956.

After business expenses and loan payments, a buyer with a 15% down payment of $570,000 would retain a profit of $300,761, which results in a 52% 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 $3,800,000 with the terms listed above, the coverage ratio is 1.55. 

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. 

**The Firm Business Brokerage is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.**

Purchase Price:

$3,800,000

$
%
OR
$
%
OR
$
Years
%

Bank Loan Needed: $

Years
%
$
$
$
$
$

Funding Details

Business:

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: $

Loan Payments

Monthly Payment to Bank: $
Yearly Payment to Bank: $
Monthly Payment to Seller: $
Yearly Payment to Seller: $
Total Monthly Debt Service: $
Total Yearly Debt Service: $

Conclusions

Fixed Charge Coverage Ratio

The bank will require a minimum ratio of 1.5 to be lendable.

Cash Flow:
2018 Cash Flow
$
Annual Debt Service: $
RATIO:

Buyer's Net Operating Income (NOI)

The amount of money the Buyer will retain as profit.

Cash Flow:
2018 Cash Flow
$
Annual Debt Service: -$
NOI:

Buyer's Return on Investment (ROI)

The rate of return on the Buyer's down payment.

Down Payment: $
NOI:
ROI: %

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210 N 78th St. 2nd Floor
Omaha, NE 68114

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The Firm Business Brokerage is not a real estate brokerage and therefore the staff will not handle any aspect of the lease, sale or purchase of real estate.