The sale of any business is a complex undertaking, of which valuation is only one component. Any sale should consider both financial and non-financial issues. Whether a business owner is a serial entrepreneur, an angel investor with a number of start-ups behind them or a business owner who has built their family business over 30 years, motivations for selling will differ significantly.

There is also another reason why owners and managers need to understand how a business is valued. When making new investments we must assess the value of both the proposed investment and our business to ensure it is accretive.

Whether we are assessing a small bolt-on acquisition, our own firm or a FTSE 100 multinational the methodology is essentially the same. For this reason Broadoak believe in applying best practice methodologies learnt in the City to businesses in the South West.

This article will however focus solely on the financial considerations and their implications. We believe that if business owners understand how their business is valued, it will enable and empower them to ensure that their business continues in the best interests of all stakeholders.

Read full article – Valuing your business