No question causes more controversy than, “How much is my startup worth?”
You’ll find plenty of valuation methodologies to help you answer that question. We’ve written about most of them. But the one factor missing from most startup valuations is market sentiment.
Without past acquisition data, you can’t know if buyers can support your asking price. Price too high and you might never attract offers; price too low and you might leave money on the table.
So: where can you find past acquisition data?
Unless you close acquisitions for a living, you only see what the media reports, most of which are the outliers – the 0.01 percent with extraordinary valuations. NDAs silence the rest.
What about brokers and investment bankers? Don’t they have the data? Yes, but in the high-stakes game of acquisitions, they seldom publicize what influences the outcomes of their deals.
So far, our biannual multiple reports have been the easiest way to fine-tune a valuation that buyers can support. But we collect much more data, and more frequently, than we can fit inside a multiple report.
We wondered: How could we use the full data stack to help value your business more accurately and get listed sooner? The answer is our new signup process.
Today, you get a FREE market-driven valuation when you sign up. Enter a few basic details, and we’ll analyze data from 100s of past acquisitions, updated quarterly, to tell you what the market would pay for your business. Submit your details to our curation team, and we’ll fast-track your listing, too.
How Quickly Do You Want to Get Acquire’d?
Our new valuation range calculator offers two acquisition speeds: fast and slow.
At the low end, in green, you’ll generate more interest. For example, if fair market value (FMV) for your business is $24 million (the midpoint of the example range), moving the valuation slider to the left by 10 percent or more could result in up to 92 percent serious interest in your business.
A bigger buyer pool can mean better terms and a faster exit.
At the higher end, in orange, you’ll generate less interest. Price at the upper limit and you might only get two percent serious interest. That’s a pretty big drop. It doesn’t mean you can’t list at that value, just that it might take you longer to sell, and with fewer buyers, you’ve less leverage in negotiations.
Many factors go into deciding your asking price. As you might’ve learned in our recent webinar, your priorities dictate what’s on the negotiating table. Maybe you want an all-cash deal or to sell quickly. Perhaps you’d offer seller financing for a higher price. Your goals influence the price you’ll accept.
At either end of the valuation range are the extremes where almost zero acquisitions happen. Move outside of those, and we usually can’t list your startup unless it meets certain criteria. We hate turning businesses away, but if we can’t help you get Acquire’d, you probably need more time to work on your valuation goals.
That said, if your business exhibits one or more of the following criteria, we may consider listing outside of the recommended range:
- Rapid growth
- A valuable domain
- Cash in the bank
- Novel or useful code
- Intellectual property (patent, for example)
- Inventory (ecommerce stock, for example)
Your valuation is based on real acquisition data, updated quarterly. And as the market changes, so too will your valuation range, so you can maximize your exit whenever you want to sell.
Like what you see? Just click Submit and our curation team will review your details and pre-approve you for the marketplace. You’re not obligated to list, nor does it cost you anything, but if you can get a good valuation now, don’t wait – list your business now while the market can support your asking price.
How to Get Your Market Valuation
If you’ve already listed your startup, your asking price is already in a good spot. Our curation team has, until now, been doing manually what our valuation calculator does automatically. No need to update it.
But if you’ve yet to submit your listing or are curious about what buyers might pay for your business, below are the steps to determine your market valuation.
A Quick Disclaimer
The valuation calculator uses anonymized, customer-generated data. We don’t participate in acquisition transactions, so the actual multiple data the calculator uses could be higher or lower than those reported to us by customers. The calculator is not intended to provide legal, financial, or any other professional advice. We compiled this data for informational purposes only to help you decide on how to most effectively use our platform.
How to Get Your Valuation and Fast-Track Your Listing
Let Nathan Wadhwani from our product team take you through the pre-approval process. Or, skip the video and go straight to the step-by-step instructions below.
- Sign up on Acquire.com. It’s free and only takes a minute.
- Choose your startup’s category. All online businesses are accepted, including SaaS, marketplace, content, ecommerce, agencies, and so on.
- Enter your startup’s URL. Please ensure it has a working, valid SSL certificate. You won’t see your valuation range unless you can prove your business is legitimate.
- Enter your last twelve months of revenue and profit. We can’t calculate your valuation range without these basic financials.
- Enter your name. Don’t worry – no one will see your name unless you list and approve a buyer’s access to your private details.
- Enter your phone number. Since time matters in acquisitions, we ask for your phone number so that we can share urgent acquisition information or help with your exit. Buyers never see this.
- See your valuation range! Carefully review the recommended asking price and whether your startup justifies going outside of this range (be as objective as you can – think like a buyer!).
- Enter your asking price. Now you know the valuation range that buyers are likely to accept, you’re in a much better position to choose an asking price that achieves your goals.
- Submit your listing for pre-approval. Our curation team will pre-approve your listing for the marketplace, saving you time after completing your full listing and getting your business in front of buyers sooner. Remember: delaying your listing could threaten your valuation should the market change or some other factor beyond your control hamper your growth or profit.
How do you calculate the valuation range?
The valuation range is based on past Acquire.com acquisition data, updated quarterly. Customers report the data, so it might not always exactly match actual closing figures, but it’s as close to real market data as you can get without actively participating in acquisition transactions, bypassing NDAs, and so on.
Can I choose an asking price outside of the valuation range?
Yes, you can. Just click the valuation slider and enter your figure manually.
However, if your asking price is over the valuation range, we might be unable to list your business unless it meets the following criteria:
- Extremely fast growth
- A valuable domain
- Cash in the bank
- Novel or useful code
- Intellectual property (patent, for example)
- Inventory (ecommerce stock, for example)
Do I have to list my startup to get a valuation?
No. Even if you submit your details for pre-approval, you’re not obligated to list. But if the valuation range supports an attractive asking price, it might be a good idea to list now rather than wait. Your valuation is susceptible to threats beyond your control, such as waning market conditions, new competitors, changes in customer behavior, and so on. Sell when the going is good (that’s our motto) to sell at the highest price.
What does pre-approved for listing mean?
Once you’ve entered your basic details and set your asking price, you can submit them to our curation team for pre-approval. We’ll review your details, and if you’re a good fit for the marketplace, pre-approve your listing. Then complete the rest of your listing, and we’ll fast-track adding your startup to the marketplace.
Can I skip the valuation step and list without it?
No. To calculate a valuation range for your business, and to determine if we can help you get Acquire’d, we need basic information from you. It’s simple stuff like your startup type, contact information, revenue, and profit. You likely know this off the top of your head, but if you need time to find the information, exit the pre-approval process and start again when you’re ready.
How often does the valuation range change?
The valuation range calculator is based on past acquisition data, updated quarterly. Why quarterly? It’s a basic estimate of how fast macroeconomic changes can ripple through the market to impact valuations.
Can I change my asking price after getting pre-approved?
Yes, although it’ll need another review by our curation team before we list your business on the marketplace. None of your information can be changed until you’ve been approved.
How do you calculate fair market value?
Fair market value in our valuation calculator is simply the mid-point in the range. In other words, it’s the average value at which startups like yours got Acquire’d during the three months prior.
Why do you need my name and phone number?
Your name and phone number help fast-track the pre-approval process by verifying you’re a real person and not a bot (frustrating, I know). If you list with us, we might also use your phone number to contact you if we have an urgent update on your acquisition or can help you attract more buyers. In any case, buyers never see your phone number and only see your name if you approve their access to your private details.
Can you value my brick-and-mortar (Main Street) business?
Unfortunately not. We only list online businesses at the moment. And since we only have acquisition data for online businesses, we wouldn’t be able to calculate a valuation range for you. Please keep in touch as we might begin listing Main Street businesses in the future. All the best for your success in the meantime.
I was rejected for pre-approval – can I still list?
No. Unfortunately, not all startups are suitable for our marketplace. That said, if we think your business could be a good fit in the future, we’ll work with you on a plan to get your business ready for acquisition. We work closely with organizations that can help startups scale and streamline their operations. If we think you’d benefit from professional consultation with one of our partners, we’ll let you know.
The content on this site is not intended to provide legal, financial or M&A advice. It is for information purposes only, and any links provided are for your convenience. Please seek the services of an M&A professional before entering into any M&A transaction. It is not Acquire’s intention to solicit or interfere with any established relationship you may have with any M&A professional.
