I am curious if anyone with private equity experience has thoughts on valuing a brokerage business. This could be any number of industries (real estate, wood products, equipment). It seems to me that these businesses typically have a few qualities that make them not fit the standard search fund criteria. I think you also hear these companies described as good jobs, but bad businesses since the principals are so instrumental to the company. Some of these aspects might be:
- CEO or principal typically has an outsize role in the business both from revenue produced but also relationship standpoint
- the salesforce is often[redacted]employees) and have few barriers to changing firms
- depending on the industry the business requires significant equity in the business to facilitate trades

What are the key factors of consideration for valuing a business like this? Are there any ways to make these businesses more appealing to traditional investors? For example:
- lock in principal for 5-years post-acquisition
- convert 1099-contractors to employees
- build a middle management staff around the principal