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September 17, 2004
Small Business Acquisition on the Rise
It seems that the increase in entrepreneurial aspirations among baby boomers that I wrote about just yesterday is creating another trend within small business.
Anita Campbell at Small Business Trends writes about the increase in small business acquisitions. She rightly cautions against assuming that acquiring a business will greatly reduce risk. "(B)uying a business can bring risks of different kinds. As the article points out, failure to do due diligence can lead to nasty surprises. A business may turn out not to be as attractive or profitable as the buyer expected."
Quite true. And a more significant risk can actually occur if the purchased business is turned around and begins to improve. The growth of a business is the stage that creates the most risk and is the stage where failure is more likely to occur and most costly to the entrepreneur (just ask any banker).
Posted September 17, 2004 06:50 AM
at Belmont University in Nashville, Tennessee. He consults with a variety of businesses on start-up and growth related issues, and with larger corporations on re-establishing entrepreneurial cultures within their organizations. Dr. Cornwall's current research interests include entrepreneurial finance and entrepreneurial ethics. He has authored or co-authored four books.
