Re: [AFMUG] Current Market Value

[Chuck McCown]

In reality the after tax profit or pre tax profit is the thing you are 
after.  Pre tax EBIDTA numbers are better because you can all kinds of tax 
management things if you have other companies or other revenue streams.  And 
depending on whether you are a partnership S or C corp the taxation will be 
different.


So EBIDTA is more of a true profit number.

-Original Message- 
From: Steve

Sent: Wednesday, February 15, 2017 2:54 PM
To: af
Subject: Re: [AFMUG] Current Market Value

God points.


Also about the EBITA - that is an interesting take on it.  Thanks.


- Original Message -
From: "Lewis Bergman" <lewis.berg...@gmail.com>
To: "af" <af@afmug.com>
Sent: Tuesday, February 14, 2017 4:11:47 PM
Subject: Re: [AFMUG] Current Market Value

All the numbers I have heard mentioned are pretty close.  I acquired a
couple of wisp companies. The only thing I would say is I only paid based
on what they were doing at the moment. I refused to pay them for my cost
advantages or what I could do with it.

One that had a bunch of old trango stuff I paid them 2x net for 2 years
with the understanding that the expense to replace their crap was to be
included. It ended up to be pretty cheap money wise but not time wise. They
were going broke so just about anything was foods for them. In the end, I
viewed it as a mistake.  I think I could have picked up the pieces cheaper
and with less hassles.  Even though we did a better job their customers
vied us as fresh meat to chew on.

On Tue, Feb 14, 2017, 1:53 PM Chuck McCown <ch...@wbmfg.com> wrote:


Yeah, like 4X EBIDTA

-Original Message-
From: Keefe John
Sent: Tuesday, February 14, 2017 10:47 AM
To: af@afmug.com
Subject: Re: [AFMUG] Current Market Value

I would look at a multiple of estimated post-acquisition EBITA. That's
what JAB does.


On 2/14/2017 11:37 AM, Steve wrote:
> What is the current market value for a WISP?
>
> I've posted this before years ago and it hasn't changed much from my
> experience. Its always been 12-16 months of your average revenue per
> customer (ARPU). It depends on the equipment and all the rest.  We've
sold
> before and we know what others have sold for. SO we generally have a 
> good

> idea what a WISP is worth.
>
> Now what if it were done with all the lower cost equipment (Mikrotik,
> Ubiquiti) which is fine in many situations but we have all Cambium? 
> We'd

> have to replace it all to fit it into our system. In all honesty we'd
> replace everything and probably take a couple years or more to get our
> return on investment which is fine.  But if someone is asking a great
deal
> more it isn't worth it.
>
> There are other factors such as strategic locations. IP space and all 
> the

> rest.   However in our case we are already expanding in that direction
and
> thought this would be the quicker path.  We'll spend about the same in
the
> next years putting up all new locations and equipment anyway.
>
> What is your opinion on the situation of someone who is asking way way
way
> more than what the market dictates?

Re: [AFMUG] Current Market Value

[Steve]

God points.  


Also about the EBITA - that is an interesting take on it.  Thanks. 


- Original Message -
From: "Lewis Bergman" <lewis.berg...@gmail.com>
To: "af" <af@afmug.com>
Sent: Tuesday, February 14, 2017 4:11:47 PM
Subject: Re: [AFMUG] Current Market Value

All the numbers I have heard mentioned are pretty close.  I acquired a
couple of wisp companies. The only thing I would say is I only paid based
on what they were doing at the moment. I refused to pay them for my cost
advantages or what I could do with it.

One that had a bunch of old trango stuff I paid them 2x net for 2 years
with the understanding that the expense to replace their crap was to be
included. It ended up to be pretty cheap money wise but not time wise. They
were going broke so just about anything was foods for them. In the end, I
viewed it as a mistake.  I think I could have picked up the pieces cheaper
and with less hassles.  Even though we did a better job their customers
vied us as fresh meat to chew on.

On Tue, Feb 14, 2017, 1:53 PM Chuck McCown <ch...@wbmfg.com> wrote:

> Yeah, like 4X EBIDTA
>
> -Original Message-
> From: Keefe John
> Sent: Tuesday, February 14, 2017 10:47 AM
> To: af@afmug.com
> Subject: Re: [AFMUG] Current Market Value
>
> I would look at a multiple of estimated post-acquisition EBITA. That's
> what JAB does.
>
>
> On 2/14/2017 11:37 AM, Steve wrote:
> > What is the current market value for a WISP?
> >
> > I've posted this before years ago and it hasn't changed much from my
> > experience. Its always been 12-16 months of your average revenue per
> > customer (ARPU). It depends on the equipment and all the rest.  We've
> sold
> > before and we know what others have sold for. SO we generally have a good
> > idea what a WISP is worth.
> >
> > Now what if it were done with all the lower cost equipment (Mikrotik,
> > Ubiquiti) which is fine in many situations but we have all Cambium?  We'd
> > have to replace it all to fit it into our system. In all honesty we'd
> > replace everything and probably take a couple years or more to get our
> > return on investment which is fine.  But if someone is asking a great
> deal
> > more it isn't worth it.
> >
> > There are other factors such as strategic locations. IP space and all the
> > rest.   However in our case we are already expanding in that direction
> and
> > thought this would be the quicker path.  We'll spend about the same in
> the
> > next years putting up all new locations and equipment anyway.
> >
> > What is your opinion on the situation of someone who is asking way way
> way
> > more than what the market dictates?
>
>

Re: [AFMUG] Current Market Value

[Lewis Bergman]

All the numbers I have heard mentioned are pretty close.  I acquired a
couple of wisp companies. The only thing I would say is I only paid based
on what they were doing at the moment. I refused to pay them for my cost
advantages or what I could do with it.

One that had a bunch of old trango stuff I paid them 2x net for 2 years
with the understanding that the expense to replace their crap was to be
included. It ended up to be pretty cheap money wise but not time wise. They
were going broke so just about anything was foods for them. In the end, I
viewed it as a mistake.  I think I could have picked up the pieces cheaper
and with less hassles.  Even though we did a better job their customers
vied us as fresh meat to chew on.

On Tue, Feb 14, 2017, 1:53 PM Chuck McCown <ch...@wbmfg.com> wrote:

> Yeah, like 4X EBIDTA
>
> -Original Message-
> From: Keefe John
> Sent: Tuesday, February 14, 2017 10:47 AM
> To: af@afmug.com
> Subject: Re: [AFMUG] Current Market Value
>
> I would look at a multiple of estimated post-acquisition EBITA. That's
> what JAB does.
>
>
> On 2/14/2017 11:37 AM, Steve wrote:
> > What is the current market value for a WISP?
> >
> > I've posted this before years ago and it hasn't changed much from my
> > experience. Its always been 12-16 months of your average revenue per
> > customer (ARPU). It depends on the equipment and all the rest.  We've
> sold
> > before and we know what others have sold for. SO we generally have a good
> > idea what a WISP is worth.
> >
> > Now what if it were done with all the lower cost equipment (Mikrotik,
> > Ubiquiti) which is fine in many situations but we have all Cambium?  We'd
> > have to replace it all to fit it into our system. In all honesty we'd
> > replace everything and probably take a couple years or more to get our
> > return on investment which is fine.  But if someone is asking a great
> deal
> > more it isn't worth it.
> >
> > There are other factors such as strategic locations. IP space and all the
> > rest.   However in our case we are already expanding in that direction
> and
> > thought this would be the quicker path.  We'll spend about the same in
> the
> > next years putting up all new locations and equipment anyway.
> >
> > What is your opinion on the situation of someone who is asking way way
> way
> > more than what the market dictates?
>
>

Re: [AFMUG] Current Market Value

[Chuck McCown]

Yeah, like 4X EBIDTA

-Original Message- 
From: Keefe John

Sent: Tuesday, February 14, 2017 10:47 AM
To: af@afmug.com
Subject: Re: [AFMUG] Current Market Value

I would look at a multiple of estimated post-acquisition EBITA. That's
what JAB does.


On 2/14/2017 11:37 AM, Steve wrote:

What is the current market value for a WISP?

I've posted this before years ago and it hasn't changed much from my 
experience. Its always been 12-16 months of your average revenue per 
customer (ARPU). It depends on the equipment and all the rest.  We've sold 
before and we know what others have sold for. SO we generally have a good 
idea what a WISP is worth.


Now what if it were done with all the lower cost equipment (Mikrotik, 
Ubiquiti) which is fine in many situations but we have all Cambium?  We'd 
have to replace it all to fit it into our system. In all honesty we'd 
replace everything and probably take a couple years or more to get our 
return on investment which is fine.  But if someone is asking a great deal 
more it isn't worth it.


There are other factors such as strategic locations. IP space and all the 
rest.   However in our case we are already expanding in that direction and 
thought this would be the quicker path.  We'll spend about the same in the 
next years putting up all new locations and equipment anyway.


What is your opinion on the situation of someone who is asking way way way 
more than what the market dictates?

Re: [AFMUG] Current Market Value

[Steve]

I agree.  Our choices are 

1) Overpay for something that is ok but not spectacular.. and put in all the 
work involved in migrating them into our network, spending money to upgrade and 
wait years for getting ROI.  
2) Or continue to expand into an area with better equipment, more reliable 
speeds and compete. 

They made the decision for us.  However I was hoping some people had some 
experience and could offer their approximate values you've seen in the past.  I 
want to be sure.  

- Original Message -
From: "Lewis Bergman" <lewis.berg...@gmail.com>
To: "af" <af@afmug.com>
Sent: Tuesday, February 14, 2017 2:05:19 PM
Subject: Re: [AFMUG] Current Market Value

I have always approached this question from a single point of view.  What
is it worth to you? Once you know the answer to that question it doesn't
really matter what they are asking. You offer what you are comfortable
with. If they don't like it, you were already planning to expand so
continue with those plans. They may become more reasonable.

On Tue, Feb 14, 2017, 11:47 AM Keefe John <keefe...@ethoplex.com> wrote:

> I would look at a multiple of estimated post-acquisition EBITA. That's
> what JAB does.
>
>
> On 2/14/2017 11:37 AM, Steve wrote:
> > What is the current market value for a WISP?
> >
> > I've posted this before years ago and it hasn't changed much from my
> experience. Its always been 12-16 months of your average revenue per
> customer (ARPU). It depends on the equipment and all the rest.  We've sold
> before and we know what others have sold for. SO we generally have a good
> idea what a WISP is worth.
> >
> > Now what if it were done with all the lower cost equipment (Mikrotik,
> Ubiquiti) which is fine in many situations but we have all Cambium?  We'd
> have to replace it all to fit it into our system. In all honesty we'd
> replace everything and probably take a couple years or more to get our
> return on investment which is fine.  But if someone is asking a great deal
> more it isn't worth it.
> >
> > There are other factors such as strategic locations. IP space and all
> the rest.   However in our case we are already expanding in that direction
> and thought this would be the quicker path.  We'll spend about the same in
> the next years putting up all new locations and equipment anyway.
> >
> > What is your opinion on the situation of someone who is asking way way
> way more than what the market dictates?
>
>

Re: [AFMUG] Current Market Value

[Lewis Bergman]

I have always approached this question from a single point of view.  What
is it worth to you? Once you know the answer to that question it doesn't
really matter what they are asking. You offer what you are comfortable
with. If they don't like it, you were already planning to expand so
continue with those plans. They may become more reasonable.

On Tue, Feb 14, 2017, 11:47 AM Keefe John  wrote:

> I would look at a multiple of estimated post-acquisition EBITA. That's
> what JAB does.
>
>
> On 2/14/2017 11:37 AM, Steve wrote:
> > What is the current market value for a WISP?
> >
> > I've posted this before years ago and it hasn't changed much from my
> experience. Its always been 12-16 months of your average revenue per
> customer (ARPU). It depends on the equipment and all the rest.  We've sold
> before and we know what others have sold for. SO we generally have a good
> idea what a WISP is worth.
> >
> > Now what if it were done with all the lower cost equipment (Mikrotik,
> Ubiquiti) which is fine in many situations but we have all Cambium?  We'd
> have to replace it all to fit it into our system. In all honesty we'd
> replace everything and probably take a couple years or more to get our
> return on investment which is fine.  But if someone is asking a great deal
> more it isn't worth it.
> >
> > There are other factors such as strategic locations. IP space and all
> the rest.   However in our case we are already expanding in that direction
> and thought this would be the quicker path.  We'll spend about the same in
> the next years putting up all new locations and equipment anyway.
> >
> > What is your opinion on the situation of someone who is asking way way
> way more than what the market dictates?
>
>

Re: [AFMUG] Current Market Value

[Keefe John]

I would look at a multiple of estimated post-acquisition EBITA. That's 
what JAB does.



On 2/14/2017 11:37 AM, Steve wrote:

What is the current market value for a WISP?

I've posted this before years ago and it hasn't changed much from my 
experience. Its always been 12-16 months of your average revenue per customer 
(ARPU). It depends on the equipment and all the rest.  We've sold before and we 
know what others have sold for. SO we generally have a good idea what a WISP is 
worth.

Now what if it were done with all the lower cost equipment (Mikrotik, Ubiquiti) 
which is fine in many situations but we have all Cambium?  We'd have to replace 
it all to fit it into our system. In all honesty we'd replace everything and 
probably take a couple years or more to get our return on investment which is 
fine.  But if someone is asking a great deal more it isn't worth it.

There are other factors such as strategic locations. IP space and all the rest. 
  However in our case we are already expanding in that direction and thought 
this would be the quicker path.  We'll spend about the same in the next years 
putting up all new locations and equipment anyway.

What is your opinion on the situation of someone who is asking way way way more 
than what the market dictates?

Re: [AFMUG] Current Market Value

[Seth Mattinen]

On 2/14/17 09:37, Steve wrote:

What is your opinion on the situation of someone who is asking way way way more 
than what the market dictates?



What's their local reputation like? How much goodwill goes the business 
have? Or is a trash pile someone put together and is now trying to 
unload? Will being associated with their name and reputation hurt or 
help or have no impact to you?


~Seth

Re: [AFMUG] Current Market Value

[Justin Wilson]

Last few successful sales i have seen boil down to one of two formulas.

Formula 1
18 Months for residential
24 for commercial
In this formula assets such as IP space were figured in. 


Formula 2
Customer asset purchase.  1.3-1.5X annual revenue.  Other assets such as 
towers, Ip space were negotiated separately. 


Justin Wilson
j...@mtin.net

---
http://www.mtin.net Owner/CEO
xISP Solutions- Consulting – Data Centers - Bandwidth

http://www.midwest-ix.com  COO/Chairman
Internet Exchange - Peering - Distributed Fabric

> On Feb 14, 2017, at 12:37 PM, Steve  wrote:
> 
> What is the current market value for a WISP?  
> 
> I've posted this before years ago and it hasn't changed much from my 
> experience. Its always been 12-16 months of your average revenue per customer 
> (ARPU). It depends on the equipment and all the rest.  We've sold before and 
> we know what others have sold for. SO we generally have a good idea what a 
> WISP is worth.  
> 
> Now what if it were done with all the lower cost equipment (Mikrotik, 
> Ubiquiti) which is fine in many situations but we have all Cambium?  We'd 
> have to replace it all to fit it into our system. In all honesty we'd replace 
> everything and probably take a couple years or more to get our return on 
> investment which is fine.  But if someone is asking a great deal more it 
> isn't worth it.  
> 
> There are other factors such as strategic locations. IP space and all the 
> rest.   However in our case we are already expanding in that direction and 
> thought this would be the quicker path.  We'll spend about the same in the 
> next years putting up all new locations and equipment anyway.  
> 
> What is your opinion on the situation of someone who is asking way way way 
> more than what the market dictates?
> 

[AFMUG] Current Market Value

[Steve]

What is the current market value for a WISP?  

I've posted this before years ago and it hasn't changed much from my 
experience. Its always been 12-16 months of your average revenue per customer 
(ARPU). It depends on the equipment and all the rest.  We've sold before and we 
know what others have sold for. SO we generally have a good idea what a WISP is 
worth.  

Now what if it were done with all the lower cost equipment (Mikrotik, Ubiquiti) 
which is fine in many situations but we have all Cambium?  We'd have to replace 
it all to fit it into our system. In all honesty we'd replace everything and 
probably take a couple years or more to get our return on investment which is 
fine.  But if someone is asking a great deal more it isn't worth it.  

There are other factors such as strategic locations. IP space and all the rest. 
  However in our case we are already expanding in that direction and thought 
this would be the quicker path.  We'll spend about the same in the next years 
putting up all new locations and equipment anyway.  

What is your opinion on the situation of someone who is asking way way way more 
than what the market dictates?