Will Acquirers Pay a Premium for Your Business? (5-Minute Test)

Описание: Most owners are emotionally convinced they deserve a premium.

Acquirers are mathematically convinced they do not.

You do not need to run a full sales process to get a first read on how a buyer will see your company - There is a simple five minute test you can do yourself:

Buyers are scoring you 0 to 2 on five specific items:

1.) Revenue Quality - Is your revenue mostly one off and project based, or is a meaningful portion recurring or reoccurring?

2.) Customer Concentration - Do you have one or two whales that can sink the ship, or a real base of customers/clients where no single customer can materially hurt the business?

3.) Owner Dependency - Does the business run solely because of you, or could it run without you (ok if it would take some transition time)?

4.) Financial Cleanliness and Visibility - Are the books ready with clear add backs and performance metrics?

5.) Growth Story - Is there a clear, believable plan for a buyer to create further enterprise value after they buy the company or just “we could grow if someone tried harder”?

Based on these and where you score (checkout the video for specific instructions), you'll know if:

Acquirers will try and discount you (0 - 4);

You will get a fair 'market multiple' (5-7); or

You will receive a premium/command competition (8-10)

In this week's video we explain further that the difference between one end of the spectrum and the other is less than you think.

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