This seems to happen more with deals on brokerage sites (like Microacquire), but I've seen several service businesses there expecting 10x EBITDA multiples for agency businesses. I've sent messages asking why they expect such a high valuation, but honestly, the responses make me think they're just clueless.
My assumption is that it's not worth trying to educate and change people with mismatched expectations, but I'm curious if anyone else has a strategy for dealing with this?
What do you do when the seller's expectations are wildly unrealistic?
by a searcher from Northwestern University - Kellogg School of Management
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Truthfully, this happened to me and I'm proud to know of the guy who bought one of the companies I had under LOI for literally the same deal terms I established. If it wasn't for the time I spent preparing the seller, I doubt that deal would have closed. Searching is a balance of skill, luck, and hope.