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SE MN | The issue is that most businesses have limited enterprise value. I know of an old but functional grain elevator that sold for 3 years net income. That is low compared companies on the stock market, but small businesses are idiosyncratic. A farm with 1000 acres owned would net maybe 200-300k if not making big capital investments. That is 40 years net income at 10k land value. Most businesses would dry up and blow away without the people running it. Almost all the value of a farm is in the assets. Most kids wouldn't want a part of a small business because they don't want to participate in running it to keep it going. Liquidating a farm is the easiest thing in the world to do, just whisper that you have land for sale at the diner and your phone will overheat by the time you get home. | |
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How to wrap my head around generational transitions/equity?
