Top 5 Questions Every Corporate Acquirer Asks

Owner-operators of a small business are very busy individuals.

Often when it comes time to sell a business, owners can sometimes be caught unprepared on critical metrics for maximum valuation.

In working with corporate acquirers and institutional investors across a wide variety of verticals, a few metrics stand out as industry-agnostic key benchmarks when assessing an opportunity for investment.

Here are the top key metrics that acquirers ask when assessing an acquisition opportunity.

  1. Market Segment – Investors will typically buy in an of targeted investment for acquirer. In private equity, they may have a portfolio company already and are looking for add-ons. For venture capital or Angel investing, this may be an area of social impact close to the investor's values.

  2. Market Attractiveness – What is the Revenue Runway for a particular industry? Where do you sit in the value chain in context to the financial opportunity?

  3. Size – Investors have targeted check sizes they want to cut. Does your gross revenue and net profit check the boxes? Too big or too small and it's a hard pass.

  4. Growth – Is this a healthy business? What has been the growth trend in recent years. If you're a start-up, talk about your Go-to-Market strategy here instead.

  5. Price – Everyone wants to buy low and sell high. What is the seller's expectations of value and why?

There are no two businesses exactly alike.

To find out how your business stacks up, schedule a consultation or send a message via our contact form.

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As a business boutique, Kennedy Capital helps small enterprises from pre-revenue startups to established organizations up to $500MM with outsourced resources for corporate growth and corporate funding deal placement.

Services include:

·     Business Brokering (buy and sell side)

·     Corporate fundraising and capital placement (debt and equity)

·     Growth and exit planning

·     Interim corporate development project management

·     Hourly business coaching

 

Locations:

San Francisco Bay Area

Carlsbad, California

 

Contact: inbox@kennedycapgroup.com 

Zoe Nielsen