Your Business Is an Asset. How Much Is It Worth?
How Much Could It Be Worth?
And How Do You Increase It’s Worth?
The primary aspiration of all business owners is freedom, and the ultimate freedom for any business owner is to own a valuable, sellable business that can work without them. Whether they sell or not.
So how does a business owner build a business that can work without them?
How does a Business Owner add value to the business so the option of a lucrative sell becomes realistic. Rather than a small, or indeed less than one multiple of profits, how do we secure 8 – 10 or even more for the same business but being structured and managed differently?
The starting point of the Value Builder programme is to get an indicative valuation of your business as it is today, and find out what the 8 key drivers for future value growth are.
We do this through the Value Builder Evaluation and Programme.
Now that you have seen how this works let’s get your score….
How Ready Are You To Exit Your Business Soon?
Although selling or otherwise exiting your business may be a idea for the future, often we really don’t know hoe realistic that is, or what the timelines may need to be. this exercise helps get some clarity on that.
PREScore™ (or Personal Readiness to Exit Score) is an 8-minute, online questionnaire that evaluates a business owner’s readiness to exit their company on a personal level.
Using an exclusive algorithm, PREScore™ calculates an owner’s readiness by identifying their status on 4
drivers of a satisfying exit.
PREScore™ determines the at-risk areas and provides personalised recommendations for improvement, helping
owners create a personal plan that ensures a happy and lucrative exit.
Why the Future of Your Business Is Critical to Its Value
As a business owner, you’re likely proud of the results you’ve achieved in the past, but when it comes to the value of your business, your future is critical. That’s why your growth potential is one of eight factors that drive the value of your business.
One metric that acquirers may use to evaluate your growth potential is your revenue per employee.
Alphabet (Google’s parent company) generates around $1.3 million in revenue per employee. Compare that to the advertising agency WPP Group, whose average revenue per employee is around $100,000.
For every dollar of revenue, WPP needs more than ten times the employees than Alphabet does.
It takes time to recruit, train, and motivate people, which is why WPP has grown more slowly and suffers much lower valuations when compared to a less people heavy company.
Measuring your revenue per employee is just one of many ways an investor may evaluate how quickly they are likely to grow your company.
This article looks into more detail around the 8 key drivers and in particular how a business may be valued through the eyes of a purchaser.