The Real Drivers Of Value In Your Business
Value and valuation are two different things, but they’re related.
When calculating business worth, most people simply look at revenue and profit, then plug those numbers into a valuation formula.
But business buyers don’t really care about your past performance — that’s just a helpful guide. They’re more interested in future performance and their likely return.
So understanding what motivates a buyer to acquire your business, and the return they expect post-acquisition, will give you a clearer perspective on what they value most — and how they value it.
Knowing how individual buyers value your business (and what’s important to them) well in advance of an exit is extremely powerful. It allows you to focus your energy and resources into creating actual value in your business — wherever it has the greatest impact on valuation.
We use a checklist of 25 Valuation Drivers when looking to maximise company valuation. This provides business owners with a toolkit to increase their end-valuation, prior to the exit itself.
What usually happens is that focusing on just one or two of these drivers will yield outsized results. Deciding on the right drivers depends entirely on your specific business and what will really move the dial.
For a copy of my 25 Valuation Drivers checklist, drop me a message on LinkedIn and I’ll send it over right away.
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