Certified Business Appraisal Price Comps

November 19, 2021

by an investor from Duke University - The Fuqua School of Business in Lexington, KY, USA

I am looking to get an appraisal on a family-owned business with ~$10M in revenue for the purpose of an intrafamily transfer. Does anyone have price comps on the cost a certified business appraisal?

Thanks for the help!

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Reply by an intermediary
from The University of Chicago in Chicago, IL, USA

Normal valuation and market comps are when a third party is buying, or bought, the business. Leverage is implicit in such normal valuation and market comps. However, when it comes to intrafamily valuation, leverage is typically not acceptable to the buying shareholder. The selling shareholder expects cash which is the buying shareholder is not able to provide. My practice is M&A and structuring. I do not do valuation. However, my software helps solve valuation and structuring problem in intrafamily transfer. Happy to share. Please DM me. (Example: 2 years ago, 3 brothers, all active in the business. Shareholder conflict. Family attorney engaged two appraiser firms w/o telling them whether they were valuing buying shareholder or selling shareholder. One firm had 10 appraisers with ASA; other had 20. One firm valued the business at $40 M; the other valued it at $150 M. Family CPA asked me to intervene.)

Reply by a professional
from The College of New Jersey in La Verne, CA 91750, USA

Thanks for the tag ^redacted‌! Niel, right now the whole valuation services industry is swamped. Everyone is doing transfers now with the uncertainty in tax law, although last I heard it seems that we'll keep the elevated lifetime exemption for the time being. At the same time, the M&A market is hot, so demand for business appraisers is high. Happy to chat with you regarding your valuation requirement, timing, and typical pricing you can expect. Email me at redacted if interested in connecting and discussing further. Thanks!

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