How do you make sure the business is as valued on the outside by a qualified buyer as much as you value it on the inside as the hard-working owner?
A realistic valuation of your business is a huge deal. As I said in chapter 1, the blood, sweat, and tears you put into your business has to count for something. Right?
A business must have value, real enterprise value, a value that others can appreciate. A value big enough for someone to write you a big, fat check.
This process requires a number of steps:
Do you know what potential buyers need to buy your business?
Is your business going to be as profitable with or without you running it?
How many customers do you have? If it’s too few, then it means your business is risky.
What is your customer’s ability to pay?
Are you depending on one or two suppliers?
What is your relationship with your vendors? Are you
paying them on time?
Is your business growing? Or is your business stagnant?
Is your revenue going up OR down?
Do you have your financials in order? That requires a
lot of work, and a good team around you, something we will get into later in the book.
Most business owners find a way to run personal expenses through their business, but buyers do not want to hear your per- sonal stories or excuses. They see your business as an investment, and they want to make sure they are going to get the best return on investment that they can.
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