The Young Bean Counter Will Determine Your Business Value
Here’s how to build businesses they’ll pay millions for.
If you want your business to sell for millions, you’ll sell to purchasers who have millions. They hire young bean counters who know little about your industry to determine what they’ll pay. Fighting this reality costs you millions. Accepting it and building for their valuation methods makes you wealthy.
10 KEY TAKEAWAYS - PROFESSIONAL VALUATION
Wealthy buyers hire financial professionals: People with millions use lawyers, accountants, appraisers, and valuators for due diligence.
The bean counter is your customer: “The customer is always right” applies when young analysts determine your price.
They’re buying systems, not widgets: Premium purchasers want corporate business systems that convert revenue to income.
They’d rather buy than build: Give them a reason to overpay for proven systems versus building from scratch.
Industry expertise doesn’t impress them: Financial professionals focus on transferability and risk, not your deep knowledge.
Profile your ideal purchaser: You know your customers’ demographics and price points but never profile potential business buyers.
Finance theory drives their valuation: Their determination of value depends on which financial frameworks they follow professionally.
You can sell to Billy or Bob: Friends and competitors will pay less than professional purchasers using systematic valuation.
Acceptance precedes value maximization: Fighting valuation reality keeps you poor. Embracing it builds wealth.
Documentation trumps expertise: What you can systematize and transfer is worth infinitely more than what exists only in your head.
📚 READING PREREQUISITES
Each post in this series builds upon the technical groundwork laid in earlier entries. The content is designed to progress in depth and complexity, making prior understanding essential for full comprehension. Key valuation concepts, models, and metrics are intentionally revisited and reinforced across multiple posts to ensure retention and clarity. Repetition and redundancy are used deliberately, not as filler, but to demonstrate how these foundational ideas interconnect and remain central to every subsequent analysis.
Recommended Prior Reading:
Why Rules of Thumb Destroy Business Value
The Three Taboos Keeping Your Business Worthless
Understanding the Four Pillars of Risk
The Question You’ve Never Asked
You’ve profiled your customers with obsessive detail.
You know their demographics, price points, buying behaviors, decision-making processes, and pain points. You’ve spent years mastering the art of selling widgets and digits to them.
But here’s the question that should terrify you: Have you profiled the best purchaser for your business that will pay the most cash for it? Are you building a company they would actually buy?
Most business owners spend decades understanding their customers and exactly zero hours understanding potential purchasers of their company.
This ignorance will cost you millions when you try to exit.
If You Want Millions, Sell to People Who Have Millions
This seems obvious when you say it out loud, but you’d be shocked how few business owners think about it seriously.
If you want your business to sell for millions, you will have to sell to purchasers who have millions. Does this make sense?
People who have millions don’t personally evaluate whether your business is worth buying. They hire professionals to commence due diligence and determine, among other things, the value of your business.
Therefore, you will have to understand the approach financial professionals take to determine corporate value.
The Financial Professional Reality
Since most business professionals in the M&A industry are lawyers, accountants, appraisers, and valuators, their determination of value is dependent on the finance theory to which they adhere.
You can say that all of this is nonsense. You can insist that your industry expertise and operational knowledge should matter more than their spreadsheets and formulas.
But the financial professionals have the money, and this is what they do.
You can sell your business to Billy, Bob, or Joe down the street. Friends, competitors, employees. They’ll pay what they can afford using seller financing and earnouts that may or may not materialize.
But if you want to cash out huge, you will be talking to a guy like me.
Like it or not, this is your reality.
The Young Bean Counter Who Controls Your Fate
