27/08/2026
Most business owners I talk to have a number in their head for what their company is worth. Problem is, that number usually comes from what they need for retirement, a conversation with a friend, or some online calculator that basically just multiplies revenue by a random factor. 🤔
Here's what actually matters though: what can a buyer verify?
I've been reading about how real valuations work, and it's fascinating because it mirrors something we see in medicine all the time. You can have a patient who feels fine based on their own perception, but when you actually run the tests and look at the data, the picture changes. Same thing with business value.
Buyers don't care about your retirement goals or what it cost you to build the company. They look at actual earnings, how the business operates, and what risks could tank performance after you hand over the keys. They want evidence, not stories.
The process of organizing and reconciling those earnings (they call it recasting) is basically quality control for your financial records. Everything needs documentation. Every adjustment needs support. Because during the actual sale, a buyer will test it all.
Whether you're thinking about selling soon or just planning ahead, this matters. Clean records, documented processes, a business that doesn't collapse if you step away for a month. That's what builds real value. 💼
Are you running a business or planning a transition? What's the biggest gap between what you think it's worth and what you think a buyer would actually pay? Curious to hear what you're seeing. Midwest Business Brokers
Learn how Indiana owners estimate business value, organize earnings, evaluate key value drivers, and prepare for a credible buyer review.