At some point most owners type the same thing into Google: what is my business worth? You land on a calculator, plug in revenue and maybe profit, and out pops a number.
Here’s the honest problem with that number: it’s almost certainly wrong. And it’s usually wrong in the direction that hurts most — too high. It can’t see your business — it sees an industry and a size, and it prices the average one.
Start with the number you want it to be. Most owners have a figure in mind, built on two things: what you’d need to retire comfortably, and what the business is worth to you — the years, the sacrifice, the thing you built from nothing. That’s real, and it matters to you. It means nothing to a buyer. A buyer isn’t paying for your history. They’re paying for future cash flow and how much risk comes attached to it. The gap between “what it’s worth to me” and “what a buyer will pay” is where a lot of exits fall apart — usually at the worst possible moment, when you’re already emotionally committed to selling.
Now the calculators. Most run a simple multiple — some factor times your earnings, based on your industry. That’s not useless; multiples are real. But a generic multiple assumes your business is average for its size and industry, and yours isn’t. Two businesses can show a buyer the same profit and be priced very differently — and the reason usually isn’t in the financials at all.
Most of the time it comes down to one thing: how much the business depends on you. If the business is you — your relationships, your knowledge, your daily decisions — then a buyer isn’t buying a business, they’re buying a job that requires your specific brain. That’s risky, and buyers pay less for risk — or they structure the deal so a big share of the price is held back, and you only get it if the business hits their targets in the years after the sale. If the business runs without you — a team that executes, documented ways of working, revenue that recurs whether or not you’re in the building — now they’re buying something that keeps producing after you hand over the keys. Same profit. Very different risk — and the price follows the risk. The calculator never asked.
A few other levers move it that formulas gloss over, too: how much of your revenue recurs versus starts from zero every year, how concentrated you are in a few big customers, how clean your financials are, and whether your growth story is believable. None of those fit in a box you plug revenue into.
If your reaction to all this is a little uncomfortable — so my number might be lower than I hoped — let me reframe it. This is good news, if you learn it early. Almost every one of these levers is fixable: you can reduce how much the business leans on you, deepen your team, build recurring revenue, clean up the books. What none of them do is move quickly. A buyer isn’t looking at last year — they’re looking at three to five years of history, because they want to see that a good year was a pattern and not a fluke. And the people-side risks are slower still: reducing how much the business depends on you, or unwinding a concentration in a few big customers, takes years in most cases.
Here’s what most owners miss: those are the factors that break the tie. When two businesses look equally attractive on paper, the one that wins is the one with less owner dependence, less customer concentration, a leadership team with real strength, people who know the business and have been there a while. None of that lives in the P&L, and none of it can be arranged in the months before a sale. Find out the day you decide to sell, and the only lever left is price. Find out five years ahead of that, and every other lever is still yours to pull. The International Business Brokers Association surveys its advisors on this every quarter. In early 2025, fewer than 5% of sellers had a written exit strategy before their first meeting with an advisor — and roughly 90% were selling a business for the first time. Most owners arrive at the biggest financial event of their working life with no plan and no practice.
And this isn’t only about selling. You don’t always get to choose the timing — a health scare, a spouse’s job that means relocating, a partner who wants out. Or the pleasant version: an unsolicited offer over coffee from someone who isn’t going to wait a year while you get ready.
The work is the same either way. Reduce how much the business depends on you, build a team that can run it, make the revenue predictable, keep the books clean. Do it for the exit you’re planning, and it’s there for the one you didn’t.
And you get to live in it meanwhile. A business that could be sold is also a business you can take two weeks away from. Exit-ready and good to own turn out to be the same list.
So who should you ask?
It depends what you actually want to know.
A broker or M&A advisor will often run you a valuation for free, and it’s worth having. Just know what it’s built for: their business is the transaction — finding buyers, negotiating terms, getting a deal closed. The number starts that conversation, and it arrives when you’re already at the end of the road.
If you need a formal number — for the IRS, a court, an SBA loan, a partner buyout — that’s different again. That’s a credentialed valuation, and it’s worth every dollar when the number has to survive scrutiny.
Neither one answers the question most owners are actually asking. Not what is it worth today, but what’s holding the number down, and what do I fix first? A realtor gives you a listing price. A home inspector tells you what to repair, and in what order. You want the price when you’re selling. You want the inspection while there’s still time to act on it. And a good readiness plan doesn’t replace the broker or the CPA — it tells you when to call them, and what to have in order first.
So use a calculator for a rough gut-check if you like. Just don’t mistake it for the truth, and don’t let it be the last time you think about this before you’re ready to sell. The number you can still do something about is the one worth knowing.