Any recommendations on how to evaluate brokers?

June 01, 2026

by a searcher from The Ohio State University - Max M. Fisher College of Business in Chicago, IL, USA

I am currently reaching out to brokers and hoping to start to see deal flow from various brokers. For people who have success with this channel, what are signs you looked for to determine which brokers are worth spending time with and constantly provide high quality deal flow? What should I look out for? I want to manage seeing more deals without being bogged down with bad deals from lower-quality brokers. I am looking for industrials businesses in the Midwest, if anybody has recommendations.

0 Likes

2 Replies

33 Views

Replies

Reply by a lender
from Cornell University in Los Angeles, CA, USA

Hi Anon - nice to meet you. A few things that have helped clients filter brokers: Look at the CIM first. If the financials are vague, the addbacks look stretched, or the seller is described as working "20 hours a week" and the business "runs itself," it is usually a bad deal or a lazy broker. Good brokers send you tax returns and a clean P&L that matches. Bad ones send you a teaser and want an LOI before you see real numbers. Ask three questions on the intro call: How many deals did you close last year? How many were SBA financed? Walk me through the last deal that fell apart and why. If they cannot answer #1 with a real number, they are not closing deals. If they get defensive on #3, move on. On SBA specifically, the brokers worth your time understand that lenders will strip junk addbacks and that the deal needs to cover debt. If a broker is pricing a $500K SDE business at $4M, no SBA lender is funding it and you will waste 60 days. Quick credential check: IBBA has a directory of CBI-certified brokers. Not a guarantee of quality, but it weeds out part-timers. M&A Source members tend to do larger lower-middle-market deals if you are looking above the Main Street range. Industrials in the Midwest: quality varies more by the individual broker than by the brand name on the door. The big franchises (Sunbelt, Transworld, Murphy) have some great brokers and some bad ones. Same with the regional boutiques. Vet the person, not the firm. We have a lot experience financing manufacturing companies via the SBA. If you ever need help reviewing a deal, I am happy to help. We work with all the major SBA lenders. The bank pay us after your loan closes, so this is a 100% free service for you. You can email me directly at redacted or schedule a meeting with me: https://cal.com/francodeguzman/30min. Look forward to chatting!

Reply by a lender
from University of Missouri in Denver, CO, USA

Would love to talk on the financing side, if needed. On the broker side, I think it is good to cast a wide net and see what deals those individuals have. By reading a few CIMs from a broker, I think you can likely get a good feel if they are pricing things appropriately, using fair addbacks, etc.

Join the discussion