IHAQ- Erin O’Leary- How do you Value a Business?

Today on IHAQ, we welcomed Erin O’Leary. Erin is a Business Broker for BayState Business Brokers.

We asked her about how she determines a value for a business.

Erin values a business to sell it. She is pricing a company to put it on the market and sell it to the next person who wants to own and operate that business.

She looks into the business’ cash flow, earnings, and top-line revenues. Then there is an element of time. You want to see at least three years’ worth of level or growing revenue.

Lastly, like the housing market, they look into ‘comps.’ What have businesses in similar industries sold for? Consider all of these factors, and you can dial in on a realistic value for your business.