Understanding the M&A Process

Enterprise Value vs. What You Actually Take Home

A buyer might value a business at $10 million, but that doesn't mean the seller receives $10 million in cash at closing. Debt, working capital, transaction expenses, escrow, seller financing, earnouts, rollover equity, and taxes all sit between the headline number and what actually lands in your account.

How EBITDA Multiples Actually Work

Two businesses in the same industry, with the same revenue, can trade at meaningfully different multiples. The multiple is where every judgment a buyer makes about risk and quality gets priced in.

SDE vs. EBITDA: Which One Actually Matters for Your Business?

Both are ways of measuring a business's true earnings — but they're built for businesses at different stages, and using the wrong one can distort your valuation.

What Are Add-Backs in a Business Valuation?

Add-backs adjust reported earnings to reflect what the business actually generates — but only the ones you can document will hold up.

What Is a Quality of Earnings (QoE) Report — and Why Does a Buyer Order One?

A QoE report isn't checking whether your books are technically correct — it's checking whether your reported earnings are the earnings a buyer can actually count on going forward.

Owner Dependency: Why It's the Single Biggest Lever on Your Valuation

A business that stops running the moment you step away isn't really a business a buyer is purchasing — it's a job they'd be buying, with your name still attached to it.

Customer Concentration: Why Buyers Draw the Line Around 20%

Losing your largest customer the week after closing is a buyer's worst-case scenario — and the more of your revenue that customer represents, the more that scenario shapes the offer you get.

Management Depth: What Buyers Mean by a 'Real' Management Team

Having good employees and having management depth are not the same thing — buyers are paying for the second one, and it's usually the harder one to build.

Recurring Revenue: Why Buyers Pay More for Revenue That Doesn't Have to Be Re-Earned

Every dollar of one-off revenue has to be won again next period. Every dollar under contract doesn't — and that difference is exactly what a buyer is pricing when they look at your revenue mix.

Growth & Market Position: Why Flat Isn't Neutral to a Buyer

Buyers aren't just pricing where a business is today — they're pricing the trajectory it's on. Flat revenue reads as a business that has plateaued, even if it's healthy and profitable.

What Is a Letter of Intent (LOI) in a Business Sale?

An LOI sets the framework for a deal — but signing one usually means taking your business off the market while a buyer confirms it.

Asset Sale vs. Stock Sale: What It Means for Your Payout

The same headline price can leave you with very different after-tax proceeds depending on how the deal is structured — and buyers and sellers usually want opposite structures for opposite reasons.

Earnouts: How They Work and What to Watch For

An earnout can close a real gap between what a buyer will pay today and what a seller believes the business is worth — but a poorly structured one shifts real risk onto the seller after they've already given up control.

Working Capital Adjustments: The Post-Closing Surprise Most Sellers Don't See Coming

Most sellers focus entirely on the headline price and structure — and are caught off guard months later by a working capital true-up that changes what they actually collected.

What Happens During Due Diligence When You Sell a Business?

Due diligence is where a buyer confirms everything they've been told about the business — it's usually the most demanding phase of a sale.

M&A Advisor, Business Broker, or Investment Bank: Who Actually Sells Your Business?

These three titles get used almost interchangeably, but they typically serve different deal sizes, run different processes, and get paid differently — picking the wrong one for your size of business is a common, costly mistake.