Owners don’t just want a buyer; they want a great outcome. Two of SHG’s sell-side leaders, Cory Martin, CVA, and Rai (Raimundo) Archibold, CFA, explain how value is built, framed, and defended in today’s market. 

Cory is a Managing Director who leads SHG’s valuation and consulting practice. He joined SHG in 2009 after earlier roles at Ayco, a Goldman Sachs business unit, and years of advising owners on valuation, M&A, and planning. 

Rai is a Managing Director who heads SHG’s investment banking division. He has been with SHG since 2010, bringing over 25 years of experience in capital markets and equity research, with involvement in more than 20 IPOs and M&A transactions. This experience is now applied to sell-side processes for private companies.

How Buyers Actually Price Your Business

“For the small-business market, it’s predominantly driven by cash flow…we do a very detailed financial analysis…and then use discounted cash flow to give a present value to future cash flow,” Cory says.

That’s the foundation. Buyers project the cash your company can produce and discount it back to today. They’ll then check that against comparable deals in your industry. If your forecasts aren’t supported by clean monthly reporting, your story falls apart. Discounted Cash Flow (DCF) and precedent market transactions and market comparables are the cornerstones of private company valuation.

Change The Model, Change The Multiple

Sometimes, changing the business model can change the valuation.  “We worked with a global trade software company. When they came to us their business model was a traditional software licensing model: revenue was non-recurring and transactional,” Cory explained. “We recommended a pivot to recurring SaaS/ARR. When we took them back to market, we sold them for about 2.5–3 times what they would have achieved five to six years earlier.” 

Why did this work? Recurring revenue reduces volatility and reduces the uncertainty of a business. In software, buyers often consider revenue multiples because recurring revenue is easier to forecast. If you can convert project work into contracts or add subscription tiers, the quality of revenue improves, and buyers tend to be more interested in your offerings.

Don’t Trust Rumors

Rai cautions against cross-industry comps. “Owners hear about a deal in another industry and assume their same-size company should get the same value. Multiples vary by industry and growth outlook.”

Context matters. A fast-growing niche will not price like a slow-growth industrial. Risk reshapes price, too. Cory notes that two similar companies can diverge if one has heavy customer concentration, “say 75–80% with one client.” Buyers discount fragility. If this is you, consider expanding your base or locking in multi-year terms before you go to market.

What To Fix Before You Sell

Rai makes it simple. “Get the financials in order. Buyers will ask for monthly cash-flow projections. For many owners, that’s the first hurdle,” he said. 

“Be ready for diligence. Gaps or delays can hurt value or kill a deal,” says Cory. “Look hard at revenue mix and management depth, especially if you plan to exit.”

Treat readiness like a project. A seller-prepared pack highlights any issues early, streamlines the buyer's work, and reduces surprises. It also sharpens the narrative around cash conversion and working capital.

SHG’s Sell-Side Approach

“We go beyond a transaction,” Cory says. “First, what are you worth today? Next, how do you become worth more? Then, how do you maximize value in the deal? We’re strategic with target lists to protect confidentiality and avoid disruption.”

Rai underscores the importance of readiness. “We’ll tell a client they’re not ready and outline the steps to get there. We’ve done that many times, then worked with them to reach readiness.” 

Overall, you need to create value first, then capture that value. A well-defined buyer list and disciplined messaging keep your team and customers informed while you manage the process.

Current Market Snapshot

“Uncertainty gave some would-be sellers pause earlier this year, but those concerns are easing. We’re prepping for more market opportunities,” Rai notes.

Cory adds that owners should look for signs of the cost of capital easing, which can help close the gap between buyers and sellers. Prepared sellers will benefit first when financing becomes more accessible and buyer confidence improves.

What Buyers Now Ask About Tech And AI

“The core valuation work still centers on cash flow,” Rai says. “What’s changing is buyer questions: How is the company using AI? That can influence interest, especially in tech-oriented businesses.”

Expect diligence on how your team uses automation, data, and AI to support productivity, compliance, and retention. Buyers are also using AI to screen targets and review documents, so you should anticipate sharper questions and faster review cycles.

The Bottom Line for Sellers

Strong outcomes start long before you decide to sell your business. Clean monthly reports, credible projections, and a model buyers trust are what drive value. Change what you can before you sell, then market a story that holds up under diligence.

Your number should reflect your sector’s growth profile, your risk, and the durability of your revenue. Not what a friend heard in another industry. If client concentration or leadership gaps exist, address them proactively. You’ll get more attention and better terms when the business feels steady and ready.

SHG’s approach is built for this process. Clarify what you’re worth, create more value, then capture it with a tight, confidential process run by trusted advisors. This helps shape the story and defend it at the negotiation table.

If you’re considering timing or want a sanity check on your readiness, start small with a valuation-led business review and a concise action plan. From there, decide whether to prep for a near-term sale or keep building value and revisit the market later. SHG can map either path and keep you moving toward the outcome you want.

Contact us today to learn more.