How to Buy a Business: Creative Financing Using an Earnout

How to Buy a Business: Creative Financing Using an Earnout

On So-called Creative Financing

There's two basic types of creative financing. The type that works and that type that doesn't. If you keep your eyes and ears open, you will continue to be astonished by new discoveries. I recently completed a 140 page lesson on creative financing that works in contrast to the kind that doesn't. The lesson consists of the proven financing techniques, I have seen used over 20 years.

Then last night I come across something quite audacious. There was a conversation about how earn-outs work. Several people tried to explain the tactic. Then one gentleman, Mark Makuta, stepped in and gave two personal examples of how he used earn-outs to buy two businesses.

Read the rest here: http://dealflow.typepad.com/my_weblog/2009/09/how-to-buy-a-business-creative-financing-using-an-earnout.html