A Boutique Firm Focusing on Consulting & Ventures


Three Types of Buyers in an Acquisition

Three Types of Buyers in an Acquisition

There are generally three types of buyers in an acquisition. You want to understand what these buyers are looking for to understand pitch, raise, ask, and counters in negotiation proceedings.

These are three relative experiences you will have with buyers.

  1. Inexperienced Buyer – This is a buyer that generally has $X to spend and is looking for $Y every month or year. They are looking at the numbers of what they have available to spend and they are analyzing how much they will get in return over time. They are probably savvy when it comes to their business and certain industries, to have the cash for a deal, but they are inexperienced when it comes to an acquisition and that will be a positive for you if they actually have the cash because they are not going to over-analyze everything. They will see the acquisition for what it generally is – an opportunity to take over someone’s hard work and experience deferred cash flow as opposed to lump sum money sitting in the bank. This will be typically the person who will look for a deal and in negotiations you want to make sure you are protected from a deal with the cash to close and the. However, sometimes these first time or second time acquirers are the best fits for your sale because they are the most flexible to get a deal done. It also can be a positive experience for both of you doing a deal as a first time seller or buyer. Most small business acquisitions that are good fits for both sides fall in to this camp assuming training and transition can be relatively smooth.
  2. Experienced Buyer Looking at a Multiple of EBITDA – They are strictly analyzing your company based on what you did EBITDA relative to revenues and are looking at how sustainable this will be. They will pick apart the numbers in due diligence. The bad news is that if your EBITDA has any discrepancies or questionable numbers this will fall apart in the negotiations for you.  The good news though is that they are number oriented and if you have good numbers, they will not deviate too much from the multiple they will provide. This can work in your favor because they will not go below their floor usually if the numbers add up. They just want to be protected from their monthly expenses to keep everything going.
  3. Experienced Buyer Looking for an Add-On to their Existing Company – These buyers will overpay on a deal because they generally are not just buying cash flow. Therefore, they can afford to not look so hard at the numbers and they can focus on intangible assets that the buyers above are not going to value properly many times. These types of deals are pretty rare to come by and when they do it is generally in the $10m-$100m and up range. These are companies who will overpay for customers, marketing, software, IP rights, brick and mortar presence, etc. You want to be a part of these deals if you can, but be aware that it will take a very long time to close and there will be many parties involved to get a deal done like this. In the end, it is worth it if you can vet how serious they are in the beginning.

Based on these 3 types of buyers, you want to adjust your approach.

You want to adjust your asking price, and payment terms (upfront, earnout, etc.) based on the potential buyers you will have interested in the opportunity.

Share post:

Leader in Business Consulting with Expertise in Representing Sellers & Buyers on Deals

Jarbly is a leader in business consulting with expertise in helping with revamped strategies, enhancing valuation, positioning for an exit, and business and real estate sales.

Contact Us

* indicates required


View Listings

© 2024 JARBLY LLC is a national brand operating through itself as a Limited Liability Company in the State of FL and works with a number of professionals located throughout the country to provide client related professional services. JARBLY LLC does not guarantee the accuracy of any of the information disclosed in this website or any materials sent including listing information including but not limited to details surrounding a business or listing or property. It is important if you transact with JARBLY LLC in any capacity, you consult a legal professional. The officers, agents, directors, or principals of JARBLY LLC are not licensed attorneys. While the principal of JARBLY LLC is a licensed real estate associate, he is not an attorney. JARBLY LLC is not a registered broker-dealer under U.S. securities laws. For more details on the nature of working together please review our disclaimer at http://jarbly.com/disclaimer and make sure to consult professional legal counsel regarding transactions to be in compliance in accordance with relevant local regulatory and legal requirements.

This website from JARBLY LLC does not constitute an offer to sell, a solicitation of an offer to buy, or a recommendation of any security or any other product or service by JARBLY LLC or any other third party regardless of whether such security, product or service is referenced in this website. Furthermore, nothing in this website is intended to provide tax, legal, or investment advice and nothing in this website should be construed as a recommendation to buy, sell, or hold any instrument or asset or to engage in any investment strategy or transaction.

This website is operated by JARBLY LLC with registered office in Boca Raton FL 33496, United States of America.


Follow JARBLY.com for Daily Content on Business Advisement, Real Estate, Disruptive Ventures, etc.


Are you a realtor? Ever wanted to join a boutique brokerage with frequent 1 on 1 mentorship, connections, and a very personal experience.

Joshua Blank the founder of Trend came from big box corporate brokerages to form his own boutique brokerage called Trend Realty. Shortly after he created the brokerage, I joined immediately. I saw the writing on the wall. A better way to advertise and market as a brokerage for realtors as opposed to the burden all on the realtors themselves.
He saw the dinosaur thinking they deployed and how real estate was changing.
As Wayne Gretzky says, skate to where the puck is going, not where it is currently.
Long over are the days where someone calls a realtor to use that realtor. Real estate has changed because everyone has the apps on their phone and the market including the properties you have access to on MLS are also at their fingertips. They want to see a property they found. You have to be the realtor who gets in front of them when they’re ready to make a purchase. We have systems that deploy where the puck is going.
With Trend you get the following:
  • Access to High-Quality Leads that Get Texted to Our Agents
  • Proprietary Tech
  • Centrally Located Offices
  • Weekly Training
  • Full-Service MENTORSHIP with years of experience - assistance with showings, exclusive access to high profile professional networks
  • Weekly Zoom Calls focused on training, learning from experts
  • Survival Guide and Business Plan - A proven path to success
  • Social Media Expert on Staff
  • Transaction Desk File Review & Management
  • Assistance with Administrative and Paperwork
  • Agent Transaction Training - Videos, Facebook Group, etc.
  • Brokerage has Q&A videos and helpful toolbox kits to help agents.
  • Agent MLS Training - Videos, Facebook Group, etc.
  • Access to High Quality Title, Mortgage Services
  • Trend Facebook Group for Networking, Videos, and Questions
  • Trend pays their agents at closing, with their CDA program
  • E & O insurance on transactions
  • Zero Monthly Fees to Agents
  • Favorable Splits to Agents
  • Creative Structuring on Deals
  • Introductions to High Quality Mortgage Companies and Lenders to Get Deals Done that Other Brokers Wouldn't Be Able to Do
  • Motivation Including Weekly Progress
  • Business Cards, Marketing Materials, Promotional Assistance etc.
  • Off Market Deals and Commercial Opportunities
  • Seller and Buyer Leads of Businesses and Commercial Opportunities
  • Direct Access to Us for Qs and As to Help You on Deals and Scenarios
  • Training on Marketing, Systems, MLS Search

Looking forward to hopefully having you on the team and amplifying your real estate career.


This will close in 0 seconds