Small Firm, $25m in billing with 10 equity partners. 3 of these partners are over 55 and own about 50% of the firm. Each of the three has been very open about not wanting to work past 60. We have not had a significant equity position retire in over 20 years (since the founder of the firm). The problem is determining the valuation and payout formula. Any suggestions, or formulas that are somewhat standard? The Partnership has not been updated in a long time and is silent on this.

like
Posting as :
works at
You are currently posting as works at

Tried to DM you but system says you're not able to receive one.

This is so much more than typed fishbowl reply. I spent time at a firm of similar size and we had formulas which in my opinion were too rich for the older equity holders. The liability to remaining partners would have too much of a burden and a disincentive. We ultimately capped the value to these retiring partners. They didn't like it but agreed. Then we ultimately merged up before they retired and they received extra whixh turned out to be a mistake that once again burdened remaining partners.

I think younger/remaining partners have more power than they realize because without the remaining people, the value to retiring partners diminishes materially. It was a value lesson learned.

If you can try to DM me, happy to connect and share what I have seen and learned.

Good luck

like

Buying out 50 percent of the equity partners in close proximity would seem to create a significant financial burden for the remaining partners and likely diminish opportunities for future partners. Not to mention other concerns. You’re probably looking at about a 1x revenue multiple. With 10 partners thats 2.5m x 3 or a $7.5m buyout. Depending on free cash flow, it may be time to start looking for a buyer.

Related Posts

Hello Fishes, I have cleared both Technical and Manager rounds in Infosys. I have total experience of 3 years and relevant experience of 2.9 years in Java Full stack development. Currently holding an offer of 13LPA and ctc is 7.8 LPA.

Please help me regarding how much ctc I can expect/ask from Infy?

Thanks in advance.!

Infosys Tata Consultancy Cognizant

like

Hello Fishes,
Is there any chance of renegotiation of offered CTC in fidelity on already accepted offer. I have joining in mid November and recently got a higher offer from another company.

Hello Sharks, I recently gave interview of Tiger Analytics and after all successful technical discussion, they were offering me Senior analytics - data Science role for 15.5 fixed + 2L jb, considering my current yoe 4.3 and in data science relevant is not much(consider it 1.5+) but my cctc is 14(13fixed+1 variable), I denied to accept this offer. Should I reconsider that?

like

What is the average salary for analyst for client onboarding in investment banking in india

like

Hello everyone!!! I am a fresher and got an offer as a trainee at aurobindo pharma. How much salary can I expect?

likefunny

Hello, I’ve just completed my TPM on-site today. How long before the decision is made by the HC? What base and TC can I expect ? I’ve 5+ years at MAANG, across engineering, analyst, TPM roles.

like

Guys what are the option to think of if I am planning to move out from EY .I work for Tax support (PAS-CES ) not sure which domain to apply if I am planning to move from EY. I'm worked for 2.6 yrs and my take home salary is just 24-27K , so I was thinking if I should think of a job change if so please advice me on which firms and domain to apply .-Thanks in advance

like

I’m an account supervisor at a healthcare communications firm making 90K. Is this typical? Im up for review in 2023 and want to know what salary expectations are like for the next level of account director

like

I have an offer with service now with 21 lpa fixed + 2 lpa variable + shares+ sign on bonus and quest with 21 lpa fixed+ bonus .which is the good option .In service now for few months i should work as AEM tester and in Quest IT IS qlQA Automation Lead

like

For a Mid-senior level associate lateraling out of a big market to a small-medium market, what is the best way to ask and receive info on partner compensation to compare long-term opportunities?

like

What are salaries like for class of 2019 in am law 50-100. I have average working attorney collections as high as our senior associates but I’m only making 215k. Trying to see what salary I should ask for.

likefunny

Anyone in tax m&a left for industry? What role did you take and what was the pay like? JD here but interested in both JD and CPA’s experiences.

like

Hi! I’ve been approached by Securonix for a Sales Director role in NA. I know the field and their competitors. The pay is good but I’ve seen a handful of websites with employee rating that is really bad. Each site has roughly 10 reviews but most are negative. Mostly referring to toxic culture and zero work life balance. How true is this in this sales org and the company in general? This is a backfill role after a 3 year tenure for the person who left.

like

Hi, I am currently working with Moody's Analytics India, with almost 3 YOE and CTC 13 Lkhs, and am currently looking to switch to PwC India, wanted to know how the hike is like and the quality of work. I have asked for a hike to around CTC 19 lkhs. PwCPwC India

like

Hi Fishes,

Please suggest which one is better ?

INFOSYS (Associate Consultant) 9LPA + 1 Joining Bonus - Bangalore
Statestreet (Cyber Security Engineer) 11 LPA (All Fixed) - Bangalore
Tietoevry (Technical Specialist) 10 LPA (All Fixed)

IAM domain - Azure and Okta. Let me know please. YOE 2.5 years

like

Please suggest what would be the in-hand salary. I deposit 1.5 lakh through 80C.

Post Photo
like
like

I got an offer from LTI for Senior Software Engineer Role with P2 grade in Banking and Financial Services BU.
3.9 YOE
Tec Stack : Java, Spring, springboot.
How will the WLB, culture , leaves , work , hikes be in LTI?
Note : I have an offer from People Tech Group for Amazon client for similar pay.

like

More Posts

I’m happy with my relationship but the thing is I never really have a spark with the girl. Can someone relate or explain? I’m not sure if I should keep doing this. Maybe I’m just in an comfort zone now?

like

I came in to the US in May on an L1. How long before I can join TSA pre-check or Global traveller or something similar ?

Can people on H1B status earn money through side hustle or is sponsorship required from each company?

like

How do you actually pass the Oracle Certification exams? The training videos are, let’s be honest, complete garbage. Is there some studying resource I’m missing?

like

If you join pwc with an approved I140, do they start the green card transfer (perm, i140) immediately ? I was told by recruiter it will start immediately after H1 transfer . I Wanted to know how true this is if anyone been through this

like

Hey all,

Are 4 days enough to do this trip Toronto - Montreal - Quebec City - Toronto. Husband and I are taking Thursday & Friday off + weekend. I’m a bit skeptical driving in unpredictable December weather. The ones who done this trip please suggest safety + entertainment + if it’s worth it in winter. Or should we just go local and do something like horseshoe resort and winter wonderland. We’ve already rented the car for those days, will have to drop it back Sunday 10 AM.

Thank you so much!

like

If anyone’s on the fence about adopting senior cats, it took 9-year-old Fatty 3 days to set up camp in our hearts ❤️🥰

Post Photo
likeupliftingfunny

Anybody have insights into internal consulting salaries (research) versus management consulting salaries?

like

Comp and roles held constant, what’s your order of preference for which FAANG+Microsoft companies to work for?

like

I work through a contractor, and was hired 2yrs ago to be a Systems Test Engineer II. They decided last minute to make me a Software Content Manager, but kept my title as is since it was supposed to be a 6mo rotation. I’m still an SCM, and am taking on leadership roles in the group. How do I ask for a title change and pay increase to reflect what I actually do? Do I ask my contract house, or my NASA mgmt? Should I ask to make the pay retroactive since I was hired to do one thing, but do another?

like

Sometimes people ask why I love being an engineer. I always say that technological innovation is amazing! If we can use technology to make our lives easier, then why not?

like
like

A lot of negativity these days. What are you grateful for at the moment?

likeuplifting

Big law firms you’re least impressed with- go!

like

how do you work on an engagement (not a regular audit engagement) where there is no senior- only a stupid entry level staff, a consultant, and a mgr who doesnt give a crap about u?

like

Counselor: Don’t let the M walk all over you.
M: Don’t let the client walk all over you.
Me:

Post Photo
likefunny

I work in the Title IX area, and would love to hear from anyone who is working with students dealing with sexual or other kind of harassment between students, and how to improve that climate.

like

Some clients are really nervous about getting scammed by a realtor. How can I ensure them that this is not the case?

like

Social media has led to the collapse of governments, the spread of misinformation, and political polarization. What will be the unanticipated consequences of the Metaverse?

like

I’m seeing the idea of taxing corporations on GAAP income get thrown around. My initial reaction is that it’s a bad idea but I’m far from an expert, especially with taxation. What does everyone here think?

like

New to Fishbowl?

Download the Fishbowl app to
unlock all discussions on Fishbowl.
That was just a preview…
Sign Up to see all discussions
  • Discover what it’s like to work at companies from real professionals
  • Get candid advice from people in your field in a safe space
  • Chat and network with other professionals in your field
Sign up in seconds to unlock all discussions on Fishbowl.

Already a user?
Login here

Share

Embed this post

Copy and paste embed code on your site

Preview

Download the
Fishbowl app

See what’s happening in your industry
from the palm of your hand.

A phone with Fishbowl app

Scan your QR code to download
Fishbowl app on your mobile

Download app

Sign up for free to view this conversation on Fishbowl

By continuing you agree to Terms of Use and Privacy Policy

Already have an account? Log in

Sign up for free to continue using Fishbowl

By continuing you agree to Terms of Use(New) and Privacy Policy(New)
Messaging rates may apply

Already have an account? Log in

For account settings, visit Fishbowl on Desktop Browser or

General

Legal