How Do I Buy A Small Business -

Analyze the Confidential Information Memorandum (CIM) , which is the seller's sales pitch. Look for "red flags" like owner dependency (the business can't run without the current owner) or vague financials. 3. Valuation and the Letter of Intent (LOI)

This is a non-binding document outlining your proposed price, deal structure (cash vs. debt), and the timeline for due diligence. 4. Due Diligence how do i buy a small business

The following steps outline the typical acquisition path from initial planning to closing the deal. 1. Preparation and Self-Assessment Valuation and the Letter of Intent (LOI) This

Small businesses are commonly valued at 2x to 4x their Seller’s Discretionary Earnings (SDE) or EBITDA. Due Diligence The following steps outline the typical

You will need specialized help to avoid costly mistakes. This team typically includes a business attorney , a CPA or accountant , and potentially a business broker . 2. Sourcing and Initial Screening