You can't improve what you haven't measured. Before you fix anything, you need to know what your business is worth today and why. That number is the starting metric for every exit, and it's the honest measure of how ready you really are.
Most owners have a rough guess about what their company is worth. A real valuation turns that feeling into a number you can work against.
Once you have the number, every decision has a reference point. You can tell whether a change made the business more valuable or just busier, and the work stays pointed at what a buyer actually pays for instead of what feels urgent.
Revenue doesn't equal value. Systems do.
Two businesses can post the same top line and be worth very different amounts. The difference is how much of the value lives in the owner's head versus in the systems, the team, and the documentation a buyer can inherit. Valuation is where that difference stops being invisible.
There's no single formula. A professional valuation weighs your business from three directions, then leans on the ones that fit how a company like yours actually trades.
What have comparable businesses actually sold for? Your company is measured against real transactions in your industry and size range, usually expressed as a multiple of earnings. This is the closest thing to a market price.
What are the future earnings worth today? The valuation projects the cash the business should produce and discounts it for risk. The riskier the earnings, the deeper the discount, and owner dependency is risk.
What are the equipment, inventory, and property worth on their own? For a healthy operating company this is usually the floor, not the price. If an offer looks like asset value, the buyer isn't paying for the business. They're paying for the stuff.
For most private companies the working math is simple to state: a measure of true earnings, times a multiple. Smaller businesses usually trade on seller's discretionary earnings (SDE). Larger ones trade on EBITDA. The earnings are arithmetic. The multiple is an argument, and the rest of this page is about winning it.
Two companies with identical profit can trade at very different multiples. These are the levers that move the number, and most of them are in your control years before a sale.
Multiples grow with the business. Buyers pay a premium for companies with more earnings, more management, and more infrastructure, because there's less risk of one bad month sinking the year.
Multiples move with buyer demand. An industry with active consolidators or private equity interest commands more than one nobody is rolling up, and the same company can fetch different numbers in different years. You can't control the cycle. You can control whether you're ready when it favors you.
A dollar of recurring or contracted revenue is worth more than a dollar you have to resell every month. Buyers pay up for revenue that shows up on its own, and mark down revenue that depends on the next project closing.
A strategic buyer with something to gain will often pay more than a purely financial one. And the headline price isn't the whole story: cash at close, seller financing, and earnouts can make two "identical" offers worth very different amounts.
This is also why your first valuation isn't a verdict. It's a baseline: an honest read on where the business stands today, in a buyer's terms, so the next few years are spent moving a number you can actually see.
When a buyer looks at your business, they're pricing risk. Every place the business depends on you, or on something no one else can see, is a place they mark the number down. These are the usual culprits.
The business runs because you run it. Every major decision routes back to you, and the relationships that matter are yours, not the company's. A buyer sees a business that leaves when you do, so they pay less for it.
Beyond you, the whole operation may hinge on one or two irreplaceable people. If a single departure would stall production, sales, or delivery, the buyer prices in that fragility. Concentrated knowledge is concentrated risk.
If the way the work gets done lives in people's heads instead of on paper, a buyer can't be sure it survives the handoff. Undocumented processes are value a buyer has to rebuild, so they discount for the effort and the uncertainty.
Messy books, blurred lines between the owner and the business, and numbers that can't be trusted all raise the same question: what's really going on here. When a buyer can't see clearly, they assume the worst and price accordingly.
A buyer isn't just paying for where the business is. They're paying for where it can go. If there's no credible path to more, no clear runway they can step into, the multiple shrinks. A flat future gets a flat price.
Knowing the number is the start. The point is to move it. The Exiter Club™ treats valuation as an ongoing measurement, not a one-time report you file away.
Your advisory team establishes a baseline valuation for the business as it stands today. This is the honest starting number, and the reference point for everything that follows.
From there, the plan goes after what's actually holding the number down: the owner dependency, the fog, the gaps a buyer would penalize. You work the drivers, not a generic checklist.
As the work lands, the business gets revalued. You see whether the moves paid off in the only terms that count for an exit, and you adjust the plan from real progress instead of hope.
This is the same work that makes a business run without you. Raise the number a buyer would pay, and you've also built something you could keep and step away from. That's the point of The XOS Method™.
You can't fix what you haven't measured. Apply now and get a straight read on where your business stands in a buyer's terms, and what's holding the value back.
Built for founders of profitable US and Canadian businesses planning an exit within the next five years.