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...tarted to form banks and provide mortgages and car loans. They might also go i...eed on the insurance learning curve. Bankers must recognize that all undertaki...

... " rather than taking to heart the term "sweat equity." In most buyouts, the first few years are supposed to be tough. You own the business as much as you own a house after a modest down payment and earn equity as you make the mortgage payments. If you don't deliver on your business plan, then the seller or bank can step in. CONCLUSION Buyers, keep in mind that if a seller wants to, they can call a few large buyers, hold an auction, and get top dollar ... sellers. You're the buyer, you have a growing book of business, and you're excited about the opportunity to own all or part of an agency. You're willing to pay a fair price for the agency, and you're thankful that the owner isn't selling to a broker or bank. You're willing to "sweat," but you don't want to lie awake at night thinking about foreclosure on your business or your house. The answer: Write a business plan. Think of the agency you're buying as a new venture in which ... have to convince skeptical bankers or venture capitalists to invest. This will help if you do talk to a bank. It will also reinforce the seller's feeling that you're a competent buyer. A business plan will also act as your personal guide after the deal, to measure whether you're doing what you said you'd do to make it work. We mentioned earlier that such rules of thumb as multiples of revenue can be useful, but can also be misused. Another helpful rule of thumb: If the balance sheet before the buyout is ...