As an entrepreneur, I often get this question: what is my business worth? But just as important is the follow-up question: what does that value actually depend on - and can you do something about it?
In recent years I, together with colleagues, have performed hundreds of business valuations within the SME sector. We now have a database of more than 500 valuations. This not only provides insight into market prices, but especially into what creates value - and what detracts from a sale.
I am happy to share this knowledge, because valuation is not a trick, but a strategic compass.
Your stage matters - more than you think
I see the highest valuations in businesses that are "exit ready": profitable, transferable and with a strong middle management. Startups or businesses that still lean heavily on the entrepreneur get structurally lower multiples. Sometimes justified, sometimes avoidable. Many entrepreneurs do not realize until late how much influence they themselves can exert on their 'marketability'.
For example, I once coached a technical installation company that was sound on paper, but highly dependent on the owner. We strengthened the management structure, formalized customer agreements and improved reporting. Within a year, the value increased by over 30%. That's how concrete value creation can be.
Your industry sets the framework - but not your outcome
IT and SaaS businesses often score higher than construction, transportation or retail, for example. That has to do with scalability, recurring revenue and risk profile. But it does not mean that as an entrepreneur in a "difficult" sector you are without a chance. If you provide insight into how your profits are generated, how stable your customer relationships are and how transferable your organization is, you can achieve high valuations there as well.
What I often hear buyers say, "I would rather pay a little more for a business that is well organized, than less for something that depends on one person."
Profit is not enough - it's about trust
Of course buyers look at your EBITDA. But they look even more at the question: can I earn this later without you? Therein lies the crux. How stable is your margin? Are processes established? Is your customer base too concentration-sensitive? If you manage that, your value increases - simply because the risk to the buyer decreases.
A recent case: an e-commerce company had great numbers, but was dependent on one major platform and on the owner himself. By spreading marketing more widely and strengthening the team, the profile shifted from "risky" to "growth-ready. This is reflected in the bids.
Business valuation is 'just' a tool
The value of your business is not a given. It is the result of choices - and of the extent to which you make your organization transferable and attractive. Therefore, a valuation is not an endpoint, but a tool. It shows where you stand, and where there are gains to be made.
My advice: get valued in time. Not because you have to sell today, but because it helps you look ahead. This way, you not only create value on paper, but also peace of mind.
