Lowell, Massachusetts, February 25, 2003 - Small business owners - the drivers of economic growth for the U.S. economy according to most economists – will lose billions of dollars over the next fifteen years as they retire and transition out of their businesses. According to Dr. Stanley Jay Feldman, Dr. Timothy Sullivan, and Roger Winsby in their new book, What Every Business Owner Should Know About Valuing Their Business, most business owners are not prepared for business transition along several dimensions. Most importantly, owners do not understand that running their businesses to minimize income taxes significantly understates the potential value of these businesses. While this problem exists today, the losses for business owners will grow to billions of dollars as the millions of successful Entrepreneurial Boomers who started businesses in the early 1980s approach retirement and prepare to sell their businesses. The authors predict that a “business transition tidal wave” is building that will reach its peak in 2005 and stay at that level for several more years. With the supply of businesses for sale quadrupling over today’s levels, only those sellers who know how to document the value in their business will get a fair return on their years of hard work and risk.

Most U.S. businesses owners will at some point in their “business life” need to have their business valued by an independent appraiser. Despite the importance of this valuation result to their financial future, few owners understand how these numbers are determined, and what they can do to impact that result. To help owners prepare, McGraw-Hill has published the first, practical guide to business valuation written for owners - What Every Business Owner Should Know About Valuing Their Business.

The book covers the basics of small business valuation, the primary valuation methods, and what owners can do to make sure that they are get the right answers. Information is well-organized and explained in context through realistic case studies covering multiple industries and valuation for various business life events, including selling a business, succession planning, and an owner divorce settlement. The book is the essential primer on how to manage an independent valuation of a business. What Every Business Owner Should Know About Valuing Their Business levels the playing field for business owners in dealing with professional advisors, who have more experience with valuation-related issues. The book empowers owners to take control over what will likely be their most important financial decisions.

Minimizing income taxes has become the dominant financial strategy for owners of private businesses in the U.S. It is especially appropriate that the official publication date for What Every Business Owner Should Know About Valuing Their Business comes on the 90th anniversary of the final ratification of the 16th Amendment to the U.S. Constitution, which created the legal basis for federal income taxes. The authors provide a clear demonstration that owners approaching retirement will benefit greatly from switching to a value maximizing strategy at least a few years before the planned transition. Other dimensions in which most business owners are not prepared for transition include:

1. Half do not have estate plans, and of those that do, most plans are not up-to-date.

2. Less than one third protect their businesses with insurance for owner death or disability.

3. Most do not have a clear defined exit strategy or plan to maximize the value of the business.

Helping owners to understand how important it is to address these issues and why an accurate appraisal of the business is necessary are central themes of What Every Business Owner Should Know About Valuing Their Business.

"The dirty little secret about the entrepreneurial life in America is that the overwhelming majority of small-business owners build/create zero equity for themselves. Think about this: you spend a lifetime building a company only to discover, when it comes time to sell, that it’s worthless. Repeat after me: It doesn’t have to be this way. What Every Business Owner Should Know About Valuing Their Business does as good a job as anything I’ve read in all my years at Inc. at changing all this. Feldman, Sullivan, and Winsby have produced the indispensable valuation guide for business owners who aren’t financial jockeys—which would be just about all of us." George Gendron, Editor-in-Chief of Inc. magazine.

"A practical primer for small business owners who want to get the most for their business when they are ready to sell." Jack Faris, CEO of National Federation of Independent Business

Dr. Feldman, an expert in business financial and valuation issues, is Associate Professor of Finance at Bentley College, Waltham, MA, and chairman of Axiom Valuation Solutions, a valuation services company using expert systems, comprehensive industry databases, and experienced staff to deliver accurate, fast, and very cost-effective valuations nationwide. Dr. Feldman is also a contributor to valuation journals, a frequent speaker at valuation-related events, and has published numerous finance and economic papers. Dr. Sullivan is a Professor of Finance at Bentley. Mr. Winsby is president and co-founder of Axiom Valuation Solutions.