Find The Right Business
7,000+ Business Listings (and growing), with Financial Analyses, Advanced Filtering, and Automated Notifications
Features That Help You Search
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Financial Metrics
Comprehensive analysis including debt service coverage ratio (DSCR), cash flow multiples, and debt payment calculations.
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Smart Filtering
Find exactly what you're looking for with advanced filtering based on financial criteria, and keyword inclusion / exclusion.
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Automated Notifications
Get notified about new opportunities that match your requirements, delivered to your inbox. Simple.
Listing Details
Basic Details
Title, Description, State, Date Added, Inventory, Number of Employees, Reason for Selling
Financials
Revenue, Asking Price, Cash Flow, Multiple, EBITDA %, Multiple, Potential Loan Payments, Debt Service Coverage Ratio (DSCR), Potential Net Profit after Taxes
Additional Insights
Competitive Analysis, Link to Original Listing, Selling Broker and Phone
Features
Listing Title
The title is a short description of the business listing, including keywords that make it simple to search. For example, if you want to exclude “restaurant” from the title, then you can add it to your list of exclusions and they will automatically be filtered out. On the other hand, if you want to search specifically for CPA firms, you can add it into the Focus criteria to find those specific listings.
Revenue
Revenue is the total amount of money a business brings in from its sales or services. This is the starting point for understanding how much money the business makes before any expenses are taken out.
Cash Flow
Cash flow can be tricky. For smaller businesses, Cash Flow is synonymous with SDE, or Seller’s Discretionary Earnings, which is the total amount of money the owner makes from the business, including their salary, perks, and any discretionary expenses. These can include perks like car payments, travel, eating out, and anything else the owner can write off as an expense to reduce their total earnings, which in turn reduces their taxable income. It’s often used to determine the business’s true earning potential for a new owner.
EBITDA %
EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It’s a way to measure a business's profitability without factoring in things like loans or taxes. For a small business, the EBITDA is the same as Cash Flow or SDE. Generally speaking, the only difference between EBITDA and SDE is often the owner’s salary (which is deducted from the EBITDA, but not the SDE). The percentage shows how much of the revenue turns into earnings. This percentage can be helpful in comparing different businesses and their ability to convert sales dollars into profit dollars. It also provides a view of the business’s core profitability and efficiency.
Price
The price is what the business is being sold for. This is often based on its profitability, assets, and market conditions, and it’s the starting point for negotiations. Understanding the price helps buyers determine if the business fits their budget and aligns with its value.
Multiple
The multiple is a number used to estimate the value of a business. It’s applied to the business's Cash Flow (or SDE) to determine its price. For example, if a business earns $100k in Cash Flow annually and the multiple is 3, the price would be $300k. The multiple tells you how long it will take to make back your investment. If you buy a business for $300k on a 3x multiple (meaning the business is Cash Flowing $100k per year), it will take you 3 years to make back your investment. Obviously you can improve the business to make your money back faster, but you should also beware of industry trends that may decrease your sales or cash flow and extend the number of years it takes to make your money back. The multiple reflects market conditions and gives insight into how the business compares to others in its industry, which is helpful for benchmarking within an industry and between industries. Most small businesses sell for 2-4x multiples.
Down Payment
The down payment is the amount of money the buyer pays upfront when purchasing the business. The rest is usually financed through a bank loan. The size of the down payment can influence financing options and the overall affordability of the purchase. This is an oversimplified view, and each case will vary. In the context of this business listing database, the assumption is that the buyer will need to pay 20% down for the business and finance the other 80%. Oftentimes, the buyer will ask the seller for a “seller’s note” which is a loan the seller provides to derisk the purchase for the buyer. This seller’s note can vary, but 10% is a reasonable amount, which means the buyer could only need to put a 10% down payment (the other 90% is: 80% bank loan and 10% seller’s note).
Debt Service Coverage Ratio (DSCR)
DSCR, or Debt Service Coverage Ratio, measures whether the business can generate enough profit to cover its debt payments. A higher DSCR means the business is in a stronger position to handle its financial obligations. A healthy DSCR ensures the business can manage its debts and remain financially stable. Generally, a small business should have a DSCR of 1.5 or greater, ideally at least 2.0. This ensures there is sufficient profit to pay for the debt plus some wiggle room in case of a down year.
Net Profit
This is the amount of money left over after all expenses, taxes, loan payments, and adjustments for the business's day-to-day cash needs. It’s a clear snapshot of what the buyer could take home from the business annually. It provides a realistic picture of the financial return a buyer can expect. There are nuances to this number depending on the corporate structure you choose, but it’s a good ballpark for comparison. To keep it simple, the formula is:
Cash Flow (or SDE)
- Debt Payment (9% interest, 10 year term)
- Capital Expenditures (pegged at 2% of revenue)
- Net Working Capital (pegged at 1% of revenue)
- Taxes (pegged at 25%, and assuming an asset purchase that is fully amortized over 15 years)
= Net Profit