Azul says that when he adds the Enterprise Value to the Retained Earnings the price seems too high.

But David, you ask, if there is a bunch of money and other assets in the company that Azul is buying, shouldn’t the seller get paid for that?

Yes, if there truly is an excess.

It all comes down to normalizing the balance sheet which is something very few people in the small business space know anything about.

You see, what we really need to know is what the Normal Net Position in Working Capital should be, then we can get to work.

Learn more in this week’s video: