We hear these two terms often and most people don’t understand the difference. In the case of a Business Broker, most are focused on the sale of private businesses below the (10) million dollar market. There is no set breakpoint in terms of value between the two but Investment Bankers tend to deal with things over (10) million in value.
Investment bankers often are also licensed by FINRA (Financial Industry Regulatory Authority) which allows them to deal with the sale of the private stock involved in the sale of a company.
Business Brokers are often regulated by Real Estate Licensing Law. For example, in the state of Florida you need a real estate license to sell a business even if there is no real estate involved in the sale.
One thing is for sure, there is no distinct definition of each. You need to judge their behavior as one of the elements of a definition. Size of the business generally implies much more work has to be done by either the broker or the investment banker. The larger the business the more experienced the broker or investment banker you should seek out.
Things are changing as well. FINRA recently exempted Business Brokers from their regulative responsibility. Although this helps define the two a little better, the most distinguishing difference tends to be in resources available to assist in the sale.
Lastly, Investment Bankers tend to charge upfront fees. Some Business Brokers do as well, but most do not.
If you want to be absolutely sure you are dealing with the right folks, and then look for companies that are both licensed to sell real estate and who sell stock.
Investment bankers often are also licensed by FINRA (Financial Industry Regulatory Authority) which allows them to deal with the sale of the private stock involved in the sale of a company.
Business Brokers are often regulated by Real Estate Licensing Law. For example, in the state of Florida you need a real estate license to sell a business even if there is no real estate involved in the sale.
One thing is for sure, there is no distinct definition of each. You need to judge their behavior as one of the elements of a definition. Size of the business generally implies much more work has to be done by either the broker or the investment banker. The larger the business the more experienced the broker or investment banker you should seek out.
Things are changing as well. FINRA recently exempted Business Brokers from their regulative responsibility. Although this helps define the two a little better, the most distinguishing difference tends to be in resources available to assist in the sale.
Lastly, Investment Bankers tend to charge upfront fees. Some Business Brokers do as well, but most do not.
If you want to be absolutely sure you are dealing with the right folks, and then look for companies that are both licensed to sell real estate and who sell stock.
