What is your company worth?
An honest valuation, using the methods the market uses and an explanation of where every number comes from.
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Methods
How we value a business
Discounted cash flow
Asset value
Market comparables
Brand, client base and intangibles
Our process
How we run a valuation
- 1 Collection of accounts and business information
- 2 Normalisation of results and adjustment of items
- 3 Application of several methods and cross-checking
- 4 Report with a value range and the assumptions explained
Our service
What does it include?
- EBITDA normalisation and adjustment of non-recurring items
- Valuation by several methods, not just one
- Comparison with transactions in the same sector
- Identification of the factors that raise and lower the price
- A reasonable value range, not a single figure
- Concrete recommendations to improve value before selling
In detail
What sits behind a valuation figure
Why multiplying profit is not enough
The usual shortcut — take the profit and multiply it by a number — fails for two reasons. The first is that the accounting profit of a small or mid-sized firm almost never reflects what the business really earns: there are owner salaries above or below market, personal expenses run through the company, rent paid to companies owned by the same person and one-off items that will not repeat. Normalising that result is the first real job in a valuation.
The second is that the multiple is not a constant: it varies by sector, size, profitability and how dependent the business is on its owner. Two companies with the same EBITDA can be worth very different amounts if one has long-term contracts and the other lives on one-off jobs.
What raises and what lowers value
In small and mid-market deals the same factors show up on both sides of the scale, and almost all of them can be worked on with enough time.
- Raise value: recurring revenue or multi-year contracts, a diversified client base, a team that runs the business without the owner, licences that are hard to replicate and margins stable over several years
- Lower value: concentration in few clients, total dependence on the owner, short or non-transferable leases, disorganised accounting, open litigation and deferred investment the buyer will have to absorb
Valuing to sell, to bring in a partner or for a dispute
Not every valuation serves the same purpose. One prepared for a sale looks for the range the market will pay and sets a defensible asking price. One prepared to bring in a partner focuses on the value of the stake and how the capital is diluted. And one needed in a shareholder separation, an inheritance or court proceedings requires a different approach and often an independent expert signature.
Tell us what you need it for before we start: the method, the level of detail and the format of the report all change.
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Common questions
Questions about business valuation
What is my company worth?
The honest answer is that it is worth a range, not a figure. That range comes from normalising the real profit, applying the multiples being paid in your sector and size band, and cross-checking against asset value and comparable transactions. What we do is give you that range with the assumptions explained, so you can defend it in a negotiation.
What is normalised EBITDA?
It is operating profit before interest, tax and depreciation, corrected to reflect what the business would earn in the hands of a third party. Owner salaries are adjusted to market, personal expenses run through the company are stripped out, rents agreed with related parties are restated and one-off income or costs are removed. It is the figure multiples are applied to, which is why it is where negotiations concentrate.
What multiple is paid in my sector?
It varies a great deal and we do not quote general figures because they mislead: within the same sector it changes with size, revenue recurrence and dependence on the owner. What we do is benchmark your case against comparable transactions and explain why your business sits at the top or the bottom of its sector range.
Does the valuation include the premises if I own them?
They are treated separately. The usual approach is to value the business as an activity, assuming a market rent, and to value the property on its own. That way you can decide afterwards whether to sell everything together or keep the premises and charge the buyer rent, which in many cases suits both sides better.
How long does a valuation take?
With recent years of accounts and the basic business information available, it is a matter of days. What lengthens the work is reconstructing disorganised accounting or tracking down information that is not documented, such as verbal client arrangements or understandings with the landlord.
Is the valuation usable for a bank or an investor?
The report is built to support a negotiation and to accompany the documentation given to a buyer or an investor, with the methods and assumptions set out. If you need a valuation with expert-witness effect for court or corporate proceedings, tell us at the outset, because the scope and format are different.
Do I have to sell if I ask you for a valuation?
No. Many clients ask for one to know where they stand before deciding, to plan a succession or to negotiate bringing in a partner. If the result suggests waiting and working on some weak points first, we will tell you.
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Sell your company
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We guide you through the entire process to secure the best transaction.
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