Bob FraserCFO & Macro Strategist | Data-Driven Investing Expert | Speaker & Author

Lack of buyer data hampers premium pricing. Channing Hamlet

Name: Lack of buyer data hampers premium pricing. Channing Hamlet
Uploaded: 2024-03-12T20:30:20+00:00
Duration: 37 s
Channel: Bob Fraser
Description: In this brief talk, Channing Hamlet explains that many business owners of sub‑$100 million revenue companies fail to recognize the depth of data buyers…

12 Mar 2024 · 1 min

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In this brief talk, Channing Hamlet explains that many business owners of sub‑$100 million revenue companies fail to recognize the depth of data buyers expect when evaluating a potential acquisition. Because these firms typically do not invest in sophisticated financial systems, budgeting tools, or robust KPI tracking, they lack the organized, granular data needed to demonstrate the value that would justify a premium price. The resulting data gaps make it difficult to present a clean, compelling package to buyers, leading to lower sale valuations.

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Most business owners don't understand the level of data that a buyer is going to require in order to get comfortable paying a premium for the business. A lot of companies in the market we work in, the sub-$100 million revenue market, don't necessarily invest in sophisticated systems and budgeting and KPI tracking and this and that. And it becomes difficult to sell the company for a premium because it's hard to get access to the data needed to provide like real insights on the value to a buyer. So I think a lot of companies just underinvest in the infrastructure and data and organization required to really have a clean package to sell to a buyer.