Buy and Build Advisors

At a 5x multiple, $300K of earnings a buyer won't accept comes off your price as $1.5M.

That's what owners miss about add-backs. Every dollar you add back to earnings gets multiplied, so the adjustments a buyer throws out come straight out of your sale price.

Some hold up: your above-market salary when they'll hire a manager for less, a true one-time legal settlement, personal expenses a new owner won't carry.

Some get laughed out of the room: marketing you call one time but spend every year, repairs you deferred to prop up a year, revenue from a project that won't repeat.

Then there's also a trust cost: Catch one aggressive add-back and a buyer re-examines every other line you claimed. The owners who hold their multiple only claim what they can defend.

The carousel breaks down what survives diligence and what doesn't. Which add-back has a buyer ever challenged you on? Tell me below.