Hi. I'm speaking to the seller of an off-market business (i.e., no broker) with a revenue stream coming from IP royalties. A majority of the revenue is from contract based administrative fees (i.e., fixed percentage of royalties) while the rest comes from perpetual finder fees. There are very little operating expenses outside of labor.

Should a yield method valuation be used for a business of this nature or should a standard earnings multiple valuation be used since more than 50% of revenue is administrative fee based?

If you're feeling really generous with your knowledge, any idea of the standard multiple for a business like this? Have direction of which professional I should seek out for guidance?

Thank you.