Realize The True Value Of Your Business

Kevin Bogenreif of Texas Capital Bank discusses what mid-market companies do to realize the full value of their businesses when selling and what other companies can do to achieve the type of multiples typically seen by mid-market firms.

Among other suggestions, is the tip to invest in professional services and put in place the right structures.

The term “middle market” is increasingly becoming a buzzword across much of the small business community, from clubhouse conversations to professional services organization happy hours. To be classified as a “middle market” business today is considered a badge of honor for many founders and entrepreneurs because it increases the valuation of your company in the eyes of bankers, and potential buyers or investors. In fact, middle market companies achieve nearly a full turn of EBITDA (earnings before interest, tax, depreciation and amortization) higher on average in valuation multiples than their small to midsized counterparts.

So what do middle market companies do to achieve the full valuation their company deserves? The answer is … it depends on to whom you’re talking.

Some organizations broadly classify the middle market as businesses with… Realize the true value of your business.