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Step 3. Determine the value of your company
It's probably the first question you asked yourself: what is my company worth? There are books written about it, but I'll give you the simple explanation here.
The value of a company is the result australia phone number library of a calculation. The past plays only a limited role in this. In short, the value of a company is mainly determined by what a buyer thinks he can earn with that company in the future. This is set off against his investment and an estimate of the risks he thinks he is running.
In any case, the buyer looks at three aspects.
Gross profit : how much profit does the company make? Often the average of the past 3 years is considered.
Composition of turnover : how predictable is the turnover? Is it one-time turnover or recurring assignments? Or even better: fixed subscriptions?
Entrepreneur dependency : how important is the current owner for the success of the company?
Calculate value with a formula
In practice, the value of a company is often expressed in a simple formula as a factor times the gross profit. In SMEs, this factor, also called a 'multiple', is on average between 4 and 6 times the gross profit. In the 'media, advertising and communication' sector - to which a marketing agency belongs - an indicative bandwidth of the EBITDA multiple of 3.6 to 4.6 is used, according to the most recent Brookz Takeover Barometer.
