Interest hikes

Personally, I think we are nearing the peak in interest rates. We are starting to see the slow down the FED was looking for, and although there might be a few more rate hikes going forward, I do not think there will be substantially more. If you can make a deal work today at current interest rates or those slightly higher, if interest rates start to come back down in the next year or two, it will only improve your cash flow going forward. Just some food for thought.

I would encourage a conversation with the broker and working/collaborating with the broker to help explain and manage the seller. Everyone understands the rate environment. Everyone understands bang out years. And remember, you are buying the company today, not its projected growth track based on the seller's mind. I would also go take an average of last 3-5 years of SDE and use that to help level-set. Because usually it is a scatter plot with an outlier or two, but some consistency which you can point to for why the valuation is not tied to 2022 or the blowout year. Good luck.