Category Archives: Valuation

value

What Drives a Strong EBITDA Multiple?

A higher EBITDA multiple is paid for lower risk, but, the biggest driver in attaining a higher EBITDA multiple is a company’s profitable growth prospects, and, this should already be evidenced by a historical growth record. Let’s look at the public markets for an illustration.  The dividend discount model asserts that the fair value of…

risk management

Managing Risk in Business to Drive Long-Term Value

Running a business requires taking risk.  Managing risk in business creates value.  Here we outline how to manage risk to drive value.  If your revenues are project oriented with little opportunity for repeat business, or you operate in an industry with low barriers to entry, or a people dependent business such as consulting, advertising or staffing, then…

asset

Top Five Impediments to Securing Exceptional Value

What are the main impediments to securing exceptional value for small private companies?  Many owner-entrepreneurs develop expectations for their business’ value based on news items and industry chatter about M&A and financing activity.  However, the small percentage of transactions that make the headlines are not reflective of the average transaction.  The factors we see most…