Deal financing has not changed significantly since before the pandemic. On average, sellers continue to receive 80% or more of total consideration as cash at close. (Cash at close includes senior debt and buyer equity.) Seller financing accounts for 14% or less of most deals. Tomorrows chart will focus on… Read More »Cash at Close
Multiples remained relatively consistent across market sectors, with one notable exception. Advisors reported that businesses with enterprise value of $5M-$50M received an average valuation of 4.1x EBITDA, a notable drop over the past few years. Notably, those sellers also received valuations at 104% of benchmark. This shows the sophistication of… Read More »Average Multiples By Deal Size 2019-2022
Despite the solid performance evidenced in the business values above, advisors are reporting a significant drop in seller market sentiment. (A seller’s market occurs when demand exceeds supply. In a seller’s market, buyers compete in order to win deals. This typically translates to increased values and more favorable deal terms… Read More »Seller’s Market Sentiment Q4 2013-2022
On average, sellers are receiving valuations at 89% of benchmark or better. As is the trend, businesses in the lower middle market performed the best, receiving nearly all or above the private benchmark they set with their advisors before going to market. Multiples remained relatively consistent across market sectors, with… Read More »Average Selling Price by Asking/Benchmark Price 2019-2022
As shown in the market pulse report Q4 2022. Data shows that of the deals that successfully closed, nearly half (47%) had at least one other offer on the table and 40% had at least two other offers. Notably, the lower middle market businesses were more likely to garner multiple… Read More »Closed Deals With Mutiple Offers
Data shows that of the deals that successfully closed, nearly half (47%) had at least one other offer on the table and 40% had at least two other offers. Notably, the lower middle market businesses were more likely to garner multiple offers than smaller Main Street operations.
Deals can fall apart for any number of reasons, and market conditions change rapidly. Maybe projections looked good when the buyer and seller started negotiations, but now the numbers look different. Also, it’s not that uncommon for small business owners to accidentally misstate or misunderstand their financials. That’s a big… Read More »Number One Reason Deals Didn’t Close, By Deal Size
Advisors gave a number of reasons that deals failed to close. Overall, 23% of advisors cited ‘unrealistic seller value expectation’ as the top reason deals fall apart. Economic uncertainty and poor financials were other leading factors. Notably, while ‘unrealistic seller expectations’ was the leading issue overall, it wasn’t always the… Read More »Leading Reasons Deals Don’t Close, Over All Deals
Working With Experienced Advisor Can Double Chance of Selling Estimates from the M&A Source and IBBA Market Pulse Report suggest that of those businesses put up for sale on the M&A market, only half will successfully sell – and that’s assuming they have an accredited advisor at the helm.The industry… Read More »Terminated Client Engagements With Multiple Buyer Offers
The Chiefs won Lisa being Missouri was a big hit. Todays chart deals with Superbowl advertisers and value of companies compared to the big spend.