What is your required IRR?

September 12, 2019
by a searcher from University of Economics Prague in Prague, Czechia
A question to both searchers and SF investors. I work with 30% as the required rate of return (looking for around 5 MIL USD targets).
This is my starting point for high-level valuation. From that and expected cashflows, I arrive at an initial price multiple to be paid for the business which I then adjust slightly with around 7 pros/cons criterions to arrive at my sweet spot multiple. Comparing that with the initial asking price I then see if there is potential to overcome any pricing gap down the road or not.
from University of Economics Prague in Prague, Czechia
from Bentley University in Boston, MA, USA