Selling A Business

Selling A Business

For An Owner / Founder Selling A Business Is A Significant Decision. Most Owners Sell Their Business Because Of Lifestyle Reasons - They Are Ready To Retire, Family Or Health, Tired Of Running The Business, Ready For A New Chapter Of Their Life However:

  • 80%

    Of Business Owners Do Not Know The Value of Their Business

  • 90%

    Of Business Owners Do Not Manage The Business To Value

  • 80%

    Of Business Owners Net Worth Is In Their Business

Get Started

We at Brentwood Growth understand each of these facts, have been in your shoes and respect what you have accomplished. We will work with you through a process, at your pace, to get comfortable and ready to exit the business on your terms. This is a process with logical steps.

The Process

Types Of Buyers

Brentwood Growth will look at each of the following three groups with you to get the maximum exposure, visibility and value. Each of these have characteristics and objectives that are unique and have pros/ cons. Brentwood Growth will work with you to identify which groups make sense to market the business to. We then utilizing proprietary databases built through the years, offshore resources to build strategic list and subscribed portals to obtain maximum exposure / interest.

Financial Buyers
Objective - Investment only – not involved day to day; looking for solid, consistent cash flow performance
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Risks to be considered include:
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
  • Partner or Vendor relationships
  • Customer concentrations (>10% to20%),
  • Competitors
  • Key Employees
  • Economic or market trends
Revenue Growth – must be demonstrated and sustainable
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Returns based on consistent cash flow performance and valuation growth; more likely to “buy low-sell high”.
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
EBITDA multiples 2.75X to 3.5X at <$1M; 3.5X to 8+X for $>1M<$5M depending on risk factors
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Owner / Operators
Active management responsibility – looking for solid, consistent cash flow performance
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Risks to be considered include:
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
  • Partner or Vendor relationships
  • Customer concentrations (>10% to20%),
  • Competitors
  • Key Employees
  • Economic or market trends
Revenue Growth – must be demonstrated and sustainable
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Returns based on consistent cash flow to fund owner/operator compensation as well as investment in company to drive growth and valuation enhancement
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
EBITDA multiples similar to financial investors with some limits due to financing or for annual compensation for management role to be included
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Strategic Buyers
Similar factors as Financial buyer to varying degrees depending on strategic considerations:
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
Returns based longer term return on investment and “accretive” shareholder value
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
  • Partner or Vendor relationships
  • Customer concentrations (>10% to20%),
  • Competitors
  • Key Employees
  • Economic or market trends
EBITDA multiples likely to be higher based on individual buyer perception of value of seller’s strategic considerations
  • Size – typically based on EBITDA
  • Revenue “Churn”
  • Reliance on founder andmanagement in place
  • Partner or Vendor relationships
  • Customer concentrations (>10% to20%),
  • Competitors
  • Key Employees
  • EBITDA multiples likely to be higher based on individual buyer perception of value of seller’s strategic considerations
Additional Strategic considerations include: