In the following, I will go into my experiences and explain a few points about really realistic company valuations and value assessments.
More and more it is increasingly common for owners to come to us with SME´s company valuations that are not suitable for a sale. In most cases, the external ratings are unfortunately not worth more than the paper they are printed on.
Here are a few aspects about how to create a realistic valuation for SME´s.
My practice shows that inexperienced or unsuitable evaluators already make serious misinterpretations in the entrepreneurial understanding of the SME´s business activities. This has massive consequences for reducing complexity. Likewise with the presentation, with the key figures up to the interpretation of annual results. Results vary annually, which is subject to interpretation. This problem cannot be solved without experience, special situations included.
I can say that from over 2,500 M&A projects for small and medium-sized companies (SMEs) after 25 years of experience in company valuation and company brokerage.
First of all, every company is individual. Comparisons can therefore never be drawn. Likewise, an intensive analysis is always necessary in order to precisely understand the company and the derived value assessment / company valuation. Without SME consulting and mediation experience, this is not feasible either.
If you want to be really successful you need a real, marketable SME business appraisal and valuation.
Note: Whoever does the company valuation should also do the brokerage. I can offer that I will check your company appraisal on a hourly basis. Also, I can coach you and do consulting around an SME valuation.
Note: The value determined in a marketable appraisal is not the price with which one goes to market. Further M&A and SME deal experience is required here.
Rolf Popp Pro Consult GmbH
Your Deal-Maker and SME specialist