The Hidden Assets That Could Make or Break Your Business Sale

In 1919, a group of investors bought the Coca-Cola Company. To help finance the deal, they did something remarkable.

They used Coca-Cola’s secret formula as collateral for a bank loan. Now, think about that. Not a factory, not a fleet of trucks, a formula. That piece of intellectual property had become so important to the business that it was valuable enough to help secure the purchase of the company itself.

Hi, I’m Ken Hargreaves. I’m a certified financial planner and founder of Wealth Gen Advisors.

And today, family businesses face the same issue, even if they don’t realize it. When business owners think about what their company is worth, they often picture the building, the equipment, inventory, or land. But much of the real value may be somewhere else.

It could be your company name, your logo, a process you developed over 20 years ago, a customer list, a recipe, software, even supplier relationships, or simply the knowledge that exists inside the founder’s head.

The problem is something can create tremendous value without the business actually owning it.

Now, imagine negotiating the sale of your company and discovering that the trademark is registered in your personal name, or that a contractor technically owns part of your website, or that the process a buyer is paying a premium for has never been documented.

Suddenly, that buyer may want a lower price, a larger escrow, or even a longer earnout.

This isn’t only about selling. The same problems can surface when passing a company to the next generation or settling an estate.

If your business represents a meaningful part of your family’s wealth, take inventory of the intangible assets that make it valuable. Make sure they’re properly owned, protected, documented, and included in succession and estate planning.

If you’d like help looking at how your business fits into your broader wealth and retirement plan, schedule a conversation with the Wealth Gen Advisor team.

And for more financial planning strategies for business owners and families, subscribe to the channel, and I’ll see you in the next video.