How a Business Valuation Can Help Your Client Make a Smart Investment

Mar 30 2017

Help your clients make smart investments with a business valuation.Whether you’re facilitating an individual’s first ever business acquisition or working with a seasoned entrepreneur, there is always a common bottom line when it comes to investing in a business—making a smart decision that yields a return on investment.

When your clients look to you for assistance in the buying or selling process of a company, you want to be able to provide them with concrete, accurate information. But, how can you accurately predict the future of the investment in question?

Only a business valuation can give you the information you need on a listing to arm your clients with their best shot at a successful, smart investment. Here’s how a business valuation from PeerComps can help you help your clients.

Identify potential problems

Say a business up for sale is reporting high income numbers. Typically, this would be a telltale sign of a profitable investment. But, what if the business owner fails to mention that these numbers are not typical in the industry or that it has been an unusually busy season? If these factors are only identified after a sale has gone through, your client
could have a serious issue on their hands.

A thorough business valuation gives you and your client a deeper look at the background of a business and its industry, so you can easily identify if the listing is a feasible investment opportunity.

Accurate, unbiased view of business worth

The value of a business can be subjective, meaning a buyer and seller might have significantly different ideas of what a business is really worth. For a business owner selling a company, the hard work and tireless dedication that went into building that business plays a big part in their estimates. On the other hand, a buyer is trained to look at potential risks involved in making such a large investment.

This is why a business broker plays such a crucial role. As a third-party, business brokers are able to help appraise businesses from a neutral perspective, and business valuation services can help you accomplish just that.

Reducing your risk

Ultimately, every investor wants to accomplish one thing—take on as little risk as possible. While there is no 100 percent risk-free investment, you can help your clients mitigate the amount of uncertainty in their ventures by providing the accurate information a business valuation can offer. These valuations provide insights into the inner-workings and financials of potential investments, painting your client a clearer picture of the opportunity at hand.

Ready to provide your clients with the information they need? Start your PeerComps business valuation now and get your results in just minutes!