It strikes me that one of the great challenges of buying a small business is that you are dealing with an uneducated counterparty. I don’t mean in terms of where they went to school, but in terms of the deal and the value of their business. According to a 2013 State of Ownership Readiness Survey (SOOR) nearly 2/3 of business owners are not familiar with all their exit options. When asked “What best describes how you are planning to transition?” Owners plans for transition, based on the 2013 SOOR were as follows: - 36% indicated they would transition via an internal exit option - 31% indicated they would transition via an external option - 31% indicated they were not sure, and - 2% answered “other” The sellers don’t even know the options! Most of their information comes from their neighbors and friends, they don’t have a clear sense of what terms lead to higher or lower prices and what they can do to increase the price of their business and how long it will take. - 50% of business owners want to transfer their business stock to their heirs. Is this even possible for the seller you are talking to? - Have the sellers ever completed a valuation? Do they know what affects the multiples or the adjusted EBITDA number?

I would be curious from this community if you felt like the numbers from 2013 still hold or if they have changed. Which sellers have expectations most closely aligned with reality?