What It Really Takes to Maximize Business Value
1. You must think like an investor, not an operator
Most owners optimize for:
Revenue
Lifestyle
Control
Taxes
Buyers and lenders optimize for:
Predictability
Transferability
Risk-adjusted cash flow
Until your business can be understood, priced, and financed by someone who doesn’t know you, its value is capped.
2. EBITDA alone does not determine value
Surprise:
Two companies with identical EBITDA can have wildly different values.
Why?
Customer concentration
Management depth
Recurring vs project revenue
Working capital needs
Capital intensity
Clean financials vs “creative” add-backs
Value is a function of risk, not effort.
3. Bankability sets the ceiling
The real valuation limiter is usually debt capacity, not buyer interest.
If your business:
Can’t support a DSCR ≥ 1.25x–1.50x
Requires excessive owner involvement
Needs too much working capital post-close
Then it doesn’t matter what a broker says—it won’t transact at that price.
Banks and SBA lenders quietly set the maximum check size.
4. Independence from you is non-negotiable
If you:
Approve every decision
Hold customer relationships personally
Are the technical expert
Are the rainmaker
Then a buyer isn’t buying a business—they’re buying you.
And you can’t be financed.
The highest-value companies run without the owner.
5. Growth without chaos beats fast growth every time
Buyers don’t pay premiums for:
Heroics
Hustle
Firefighting
“We just landed a huge client last month!”
They pay premiums for:
Repeatable processes
Scalable systems
Documented operations
Measured, sustainable growth
Predictable growth > aggressive growth.
6. Optionality creates leverage
Maximum value comes when:
You don’t need to sell
You can refinance, recapitalize, or acquire instead
Multiple exit paths exist (ESOP, strategic, PE, family, roll-up, partial sale)
Desperation compresses value.
Options expand it.
7. Value is engineered years before a sale
The biggest mistake owners make:
“I’ll fix this when I’m ready to sell.”
By then, it’s too late.
The highest exits are engineered 24–36 months in advance, using:
Investor-grade financials
Management succession
Capital structure optimization
Strategic M&A (add EBITDA and reduce risk)
The real surprise?
Most owners already have the raw ingredients for a much higher valuation.
What they lack is:
An investor lens
A bankability roadmap
A disciplined value-creation plan
That’s the difference between:
A “nice business” and A “sellable, financeable, premium-valued asset”