Matt W. Kane

Buy Then Build

Buy Then Build by Walker Deibel

Book: HBR Guide to Buying a Small Business – Richard Ruback and Royce Yudkoff

Formulas:

X = your liquid capital
PP = Purchase Price
SDE = Seller Discretionary Earnings
M = Multiplier

  • PP = X / 0.1
  • PP = SDE x M
  • PP / M = SDE

Rule number one for establishing a purchase price is making sure the business can afford to pay for the business.

Determine how transferrable the business is.

Seller Interviews

Initiate with “Tell me about your business.”
What makes this company different?
Why do people buy from you?