A message from DealCoach co-founder, Scott Bushkie
As you look at your options for business valuations, I want to share where we fit in and why we think DealCoach is best.
There are cheaper services out there, but like anything, you get what you pay for. Many of the low cost valuation services you find online are computer-generated models only.
With cheaper sites, you have to enter your own information and hope you do it correctly. But more importantly, those site are using aggregated data with business sold AND businesses listed (but not sold).
What that means is that the computer is calculating your business value off unreliable information. All those overpriced businesses that haven’t actually sold are throwing off the model.
On the flip side, you can go to your regional accounting firm where they do certified valuations. A certified valuation is expensive and usually unnecessary. Expect to spend at least $5,000, up to $30,000, for an accounting team to hone in on an exact number.
Certified valuations are usually required for legal conflicts. The rest of the time, an Estimate of Value (EOV) will do.
Deal Coach: Technology + Human Analysis
At Deal Coach, we think our EOV provides the best of both worlds. We’ve developed technology to take a lot of the cost out of the process, but we still have a human element to review the data and make sure we’re giving you a solid, credible estimate of what your business would sell for in today’s marketplace.
When we’ve tested our EOV process against certified valuations, and we are invariably on target.
What’s more, I’ve sold hundreds of businesses over the years. We don’t publish an asking price, and we almost always bring multiple buyers to the table, generating an auction-like environment for our sellers. We understand what a business is worth. We understand what the market will truly bear.
If you use QuickBooks, the DealCoach system can automatically pull the correct financial information right from your records. If you don’t have QuickBooks, you can enter the information yourself. We have popup help boxes and even tutorials to walk you through the process.
Next, we use one of the financial industry’s most trusted research partners, to get accurate business comparables for privately held businesses that have actually sold. We invest in better data where the cheaper online valuation sites won’t.
After that, we make our own personal analysis. What are we hearing from industry experts, other M&A advisors, and private equity investors? What special circumstances in your business could influence the value? How to you measure up against benchmarks that can’t be captured in numbers?
Better Information, Better Results
At DealCoach, our vision is to bring cost effective solutions to the small business owner and educate them on what their business is worth.
If you’re selling: Use this information to make sure you don’t under-price or over-price your business.
If you’re growing: Use the EOV as a regular report card. Make sure you’re on target, and get personalized advice on how to prepare your company for future sale.
By Scott Bushkie
With more than 20 years in the M&A industry, Scott is a recognized leader in the field, providing exit strategies, business valuations, and M&A advisory services to business owners in the lower middle market. He has successfully executed sales to domestic and international buyers, private equity firms, family offices, and strategic buyers. Follow DealCoach on Linkedin