"If you are doing a QoE, we are not signing this LOI."

lender profile

July 18, 2025

by a lender from Mississippi State University in Nashville, TN, USA

Tough words to hear for a searcher I know. Business brokers out there- is this your policy? How many deals have you seen a QoE blow up? I am not advocating for or against QoE just making an observation and asking for feedback. With that said, in my opinion, for many businesses if you can verify gross revenue with some degree of certainty (perhaps via sales tax reports, credit card transactions, etc.) then you should be able to model out expenses using industry trends and common sense. You can also get the bank statements and confirm cash going in and cash going out. And if you do this yourself, it is probably going to teach you more than relying on a 3rd party to do it. But we all know some businesses are more complex than others and the above approach may not make sense depending on complexity and deal size. I play in the SBA space so my deals are $8mm and below. Here is a link to my post on LinkedIn on this same topic. Wanted to share here on SearchFunder as well! https://www.linkedin.com/posts/matthewsmatt_qoe-eta-mergersandacquisitions-activity-7351333219973120001-GDTf?utm_source=social_share_send&utm_medium=member_desktop_web&rcm=ACoAAATlmmkBDjQVyRXFoE08axWhegBdTbBaVgg
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Reply by a searcher
from Pomona College in Asheville, NC, USA
walk away, I've never heard of this
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Reply by a professional
in Cardiff, UK
This would be a red flag in my opinion. We do plenty of QoEs on deals in this range and it’s accepted by most to be a necessary part of the acquisition process. A QoE shouldn’t be viewed as a means to get funding, although it can also serve that purpose when a lender does require it. It’s to give the buyer peace of mind that the financials check out before committing to the deal.
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