This FAQ is written specifically for sellers—people who’ve built something and want to know what it’s worth. Every answer is framed for your perspective: what you need to know, what you need to prepare, and what you need to negotiate.
Your Seller’s Valuation FAQ
Quick Answers (Top 5 Most Common Questions)
1. What should I expect from selling?
Expect 2.5x-3.5x annual SDE. Expect 60-120 days from listing to closing. Expect buyers to negotiate 5-15% below asking.
2. How do I calculate my SDE?
Net profit + owner salary + personal expenses + one-time costs. Document everything. See our SDE guide and add-backs guide.
3. How do I prepare for maximum value?
90 days: document SOPs, reduce owner hours, launch email marketing. 6 months: diversify traffic, improve margins, build content library.
4. What should I never do?
Never hide problems. Never inflate numbers. Never list at your floor. Never accept a lowball without countering.
5. Should I use a broker?
For businesses over $100K, usually yes. A broker’s network and negotiation skills often recover their 8-15% fee. See our broker guide.
Advanced Valuation Questions
6. How do I justify my asking price?
Show your SDE calculation, factor scores, comparable sales, and intangible asset documentation. A documented price is hard to attack.
7. What if buyers offer less than expected?
Counter with data. Ask what factors led to their lower valuation. Their objections are feedback—use them to either adjust your price or strengthen your position.
8. How do I handle due diligence?
Prepare a data room with everything organized: P&L, bank statements, analytics, contracts, add-back schedule. Respond quickly to buyer requests.
9. Should I offer seller financing?
Only if you trust the buyer’s operational ability. Seller financing typically means 20-30% down with the rest over 3-5 years. All-cash is simpler and safer.
10. What deal structures should I consider?
All-cash (simplest), earn-out (part of price tied to performance), seller financing (deferred payments). All-cash is best for most sellers.
Timing & Process Questions
11. When is the right time to sell?
When growth is trending up, margins are stable, and traffic is diversified. Sell from strength, not from burnout.
12. How do I find buyers?
Marketplaces (Flippa, Empire Flippers), brokers, and direct outreach. A broker brings the broadest qualified buyer pool.
13. What happens after accepting an offer?
Due diligence (1-3 weeks), legal documentation (1-2 weeks), escrow and transfer (3-7 days). Be responsive throughout.
Risk & Red Flags
14. What risks should I disclose?
Customer concentration, supplier dependency, platform risk, and seasonality. Disclose with mitigation plans. Undisclosed risks kill deals.
15. What’s the most important preparation?
Accurate financials. Buyers verify everything. Discrepancies between your claims and reality destroy trust—and trust is everything in a sale.
Your Seller’s Valuation FAQ