Top 5 criteria to acquire a business

August 21, 2023

by an investor from McGill University in Toronto, ON, Canada

Hey guys, I recently joined this forum. I'm excited to be a part of this fantastic community!

To all you buyers out there, I'm eager to hear about your strategies and insights when it comes to acquiring businesses. Specifically, what are your top 5 criteria for evaluating potential acquisitions? Additionally, I'm curious to know about the key challenges you typically face in your search process

Reply by a searcher
from Loughborough University in Nottingham, UK

For me the key is that it is a business I understand and can add value to. If both are true then run the finances and if everyone can make a good return then things are good. Next up would be trying to understand the company culture and seeing whether you can fit into that. Finally, does it feel right, would I get excited to come to work here everyday, but make sure this is the last point not the first point on the list.

Reply by a searcher
in Rindge, NH 03461, USA

My top 5 (no specific order): sufficient EBITDA, reasonable multiple/price, business I can wrap my head around, business I can add value to, clear path for growth, fundable, seller financing. My biggest hurdle in doing deals is securing funding to close the gap between significant seller financing and purchase price. Happy to talk more if you want.

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