Players in
a proactive niche of the finance industry are gearing up to take advantage of
an anticipated wave of opportunity triggered by the retiring Baby Boomer
generation. In 2011, the oldest members of the boomer population started
celebrating their 65th birthdays, and for many this represents the transition
into retirement. For the next 17 years, approximately 10,000 Baby Boomers each
day will turn 65, a trend expected to generate the largest wealth transfer in
American history.
Many Baby
Boomers are entrepreneurs (some estimates peg the figure as high as 66% of
small businesses), and for them, exiting the workforce means putting a For Sale
sign on the door of their business. As a result, approximately $10 trillion
worth of business will change hands in the next 11 years. The consensus is,
however, that though many of these business owners are riding out economic
uncertainty and waiting for the right time to sell, the majority of them
haven’t planned an exit strategy to actually do so.
More and
more equity firms are already staffing up, gearing up, and beginning to cater
to the needs of retiring Baby Boomer business owners. These firms are seeking
out investors and partners to provide additional capital and recruiting younger
management to help further develop these companies before selling them at an
increased value. Anxiously waiting at the other end of the spectrum are loads
of buyers waiting to place a bid.
Operating
through two strategic business units, Ohio-based LD Holdings is one of the
firms preparing for this massive transfer of wealth. The financial and
management holding company has developed a three-step process to bridge the
sale and transfer of Baby Boomer-owned businesses with $2 million-$20 million
in revenues and operating in one of four key sectors: biomedical, tech,
entertainment or the green sector.
Keeping a
database of target companies, investors and entrepreneurs, LD Holdings aims to
stand out as a well-prepared and able player throughout this generational shift
of assets, acquiring multiple profitable business entities to produce venture
capital returns without the risks associated with venture capital start-ups.
Based on
its five-year strategy, LD Holdings will merge its acquired entities into
cohesive business units to generate revenues through organic growth to exceed
$30 million during the first five years. The company recently received a
financial commitment of up to $10 million from a qualified institution,
enabling the company to pursue its initial business acquisitions.
In a
statement announcing the letter of intent, LD Holdings CEO John Ayling summed
up the company’s opportunity and vision for the near future, saying, “I am
enthused that we have taken one of the first big steps in accelerating our
efforts to target the best of up to 25 million companies coming of age in the
‘Baby Boomer’ era. In my opinion, this is an unprecedented ‘capture of wealth’ opportunity
for small businesses in the history of our country. This secured line of credit
facility will form the debt requirements the company needs to complete its
first three acquisition targets which will total $16 million sales and $2.3
million EBITDA.”
For more
information, visit www.ldholdings.com
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