It’s safe to say that many business owners have considered selling their business at one point or another. Regardless of what factors provoke these thoughts of selling, it is imperative that owners carefully consider timing in order to maximize value. How do business owners determine whether or not it is the right time to cash out?
This may come as a surprise to many business owners but right now is a great time to consider selling. In fact, if you are an entrepreneur with a well-run business, you should have no shortage of buyers.
A common valuation method is to use a multiple of Earnings Before Interest Tax Depreciation and Amortization (EBITDA). Valuation multiples have hit their highest point in Q1 of 2016 at 12.2 times EBITDA.