If the company is 5 years old, ask them for their tax filing and yearly financials summed up by year. Then ask for the current year on a month-by-month basis. If applicable, get the balance sheet for those years as well. In this format, unless they are planning to out-right defraud you, it is hard to hide the truth. My 4th rule: Most sellers are delusional on their evaluations and will try to force the hand of the buyer to pay too much for the venture.
While acquisition statistics within the United taiwan email list States show that only 2% of businesses are successful at being sold. Why listings never get sold is because the sellers have their heads in the clouds when it comes to evaluation, and refuse to see that their company is really bad off, or is nowhere worth what they think it is. In the brick and mortar world of business most businesses evaluate at 0.
5-10 times their yearly earnings, depending on their stance. If the business is shrinking, don’t expect much more than 1 times. To reach 10 times yearly, they normally have to have a yearly growth rate of 20% plus per year, proven over a couple years span. As most of us know, in the world of Flippa, websites are priced at 1-30 times their monthly earning, with most deals being closed at around 8-12 times their monthly earnings.
Never fall for it! Flipp’s stats show that 35% of their listings are successful at selling
-
- Posts: 12
- Joined: Sun Dec 22, 2024 3:51 am