Does anyone have resources they can share to establish a valuation?

by a searcher from Northern Illinois University

7 months ago

Does anyone have resources they can share to establish a valuation?  Specifically, when you expect volatility in future returns?

0 likes
89 views
14 comments

searcher from University of Virginia-Darden - Darden School of Business

Great resources here - following to review some of these myself. I found great value in the BVR transactions and IBIS World industry reports from Searchfunder.

7 months ago | like reply | 0 likes

searcher from University of Massachusetts at Lowell

As others have mentioned here a good starting point is BVR. But final valuation will be based on a number of factors besides a straight multiple to SDE or EBITDA. You'd have to consider your risk tolerance, working capital needs, overall deal structure, Debt service coverage, etc. Also you'd want to compare the valuation to the enterprise value based on future cash flows as well. I'm finding that alot of sellers (at least of manufacturing businesses are asking for astronomical multiples for sub 1.5MM EBITDA deals. If you're looking to get a deal done, you might have to consider a higher multiple more seriously, otherwise risk waiting on the sidelines.

Theres a lot of competition now in the ETA space, So its a good idea to present your best offer and negotiate on terms so you can get in the game. Making this adjustment alone, has totally increased my deal flow in the last 6 months.

7 months ago | like reply | 0 likes

More on Searchfunder

Just Closed on My First Deal! Reflections and Takeaways for other Searchers

45,152 transactions are available on Searchfunder (now searchable by keyword)

Now everyone has unlimited IBISWorld access

Family office looking for traditional searchers

2 Best Ways To Find Motivated Sellers, Off-Market Deals

Downsides of "buying a job" below 750k+ EBITDA?

Thought piece: Proprietary sourcing methods that delivered 2 acquisitions

6-7x for a Self-funded Search Deal?

Searchfunder is an online community and toolkit for searchfunds. Over 80% of those involved in searchfunds maintain a Searchfunder.com account to help them network, problem solve challenges, and keep up with the industry.

We maintain partnerships with database providers that make searching more effective, efficient and affordable along with features that help searchers find deals and investors and vice versa.