If you’re an owner considering an exit, one of the first questions that comes to mind is: How do I price my business for sale? At Marsh Creek Advisors, our answer is simple: you don’t.
We don’t put price tags on the companies we represent. Instead, we run a structured, competitive process that allows the market to determine the value. We do this because we’ve learned through experience that the best way to get a strong outcome is to let qualified buyers compete, not anchor expectations or cap potential with a listed price.
Why We Don’t Set Asking Prices
While it’s natural to wonder how to price a business for sale, it’s not the most effective step for owners considering an exit. This is because setting a price creates a ceiling. It turns a negotiation into a yes-or-no decision.
When you set an asking price, you inadvertently frame the deal around a number, not the true strategic or financial value of the business. Even if the price is “reasonable,” you risk anchoring buyer expectations too low, or scaring off potential buyers who may have paid more under different terms or structures.
In contrast, inviting buyers into a competitive process without price guidance opens the door to creative deal structures, premium offers, and unexpected outcomes. Buyers feel that they’re competing for a quality business, and may come to the table with more urgency and intention. Instead of negotiating from a fixed number, you’re going into the negotiation with leverage and flexibility.
Creating a Market Around Your Business
A powerful shift for business owners is to move from asking how to price a business for sale, to considering “how do I create a market around my business?”
At Marsh Creek, we don’t set a price, we create a market. In our view, a “market” is a dynamic, competitive environment where multiple buyers evaluate your business based on its intrinsic qualities, not a posted number.
This approach shifts the power dynamic of the deal. When buyers know they’re not the only ones at the table, they enter the process more prepared, more serious, and more motivated to put forward their strongest terms.
In this kind of process, price becomes the output, not the input. Value emerges from competition, not assumption. You’re no longer focused on the narrow question of “How do I price my business?” Instead, you’re addressing a more strategic concern: “How do I position my business to attract the strongest buyers?”
What Really Drives Value
Rather than thinking about how to price a business for sale, we advise owners to focus on the value drivers that buyers care about. These factors influence how buyers assess risk, growth potential, and strategic fit.
Key drivers include:
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- Recurring and growing revenue: Predictable earnings and a history of growth are prized by financial and strategic buyers alike.
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- Diverse customer base: A business that isn’t overly reliant on a small number of customers is seen as less risky and more stable.
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- Strong margins and scalability: Buyers pay more for businesses that are efficient and can grow without a proportional increase in costs.
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- Capable leadership and systems: If the business can operate smoothly without you, it’s more transferable — and more valuable.
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- Industry tailwinds: Being in a growing sector or a niche with long-term demand can lead to a valuation premium.
The Role of Valuation, Without Setting a Price
We do provide our clients with a confidential opinion of value before going to market. This internal assessment helps owners understand what a reasonable range might look like, and what kind of buyers to expect. It will give you a framework to answer the question of how to price a business for sale.
However, we don’t share this value with the market. Sharing this type of information anchors expectations, and has limited upside for sellers. Instead, we use “opinion of value” to inform strategy and prepare our clients for the types of offers they may receive.
Ways To Think About Valuation
Valuation is an important part of the process. This is not because it sets the final price, but because it helps you frame realistic expectations and prepare for buyer conversations. It’s a reference point, not a rule.
There are several common approaches to valuation, each offering a different lens through which your business might be viewed:
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- Market-based comparisons look at similar businesses that have sold recently. These comps can provide a general range. However, note that no two businesses are identical. Key differences in industry, geography, or growth potential can significantly affect value.
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- Earnings multiples are one of the most widely used methods, typically applied to EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) or SDE (Seller’s Discretionary Earnings). These multiples reflect what similar businesses have commanded in the market.
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- Income-based models, like discounted cash flow (DCF), attempt to project future cash flows and assign present value to them. These are useful for buyers with a long-term investment lens but can be sensitive to assumptions about growth, risk, and discount rates.
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- Asset-based approaches are more relevant for capital-intensive businesses. They assess the value of tangible assets like equipment, inventory, or real estate — which may matter more than cash flow in certain industries.
Each of these models has its place, but none of them tell the full story. A business is worth what a qualified buyer is willing to pay. This number is influenced as much by strategic fit and competition as it is by spreadsheets and formulas.
How We Help You Exit on Your Terms
The goal of our PowerExit™ process isn’t just to find a buyer, it’s to find the right buyer, under the right terms, at the right time. This is a more comprehensive process than simply defining “how to price a business for sale”. It includes multiple steps to create a competitive market around your business.
Prepare your business to be viewed favorably by the market
Before we ever speak to a buyer, we help you get your business deal-ready. That means reviewing your financials, identifying potential red flags, and making sure the business looks clean, stable, and credible from a buyer’s perspective.
Develop a clear narrative that highlights growth potential
Buyers don’t just want a business that’s doing well today, they want to see where it can go tomorrow. We help you craft a compelling, growth story that speaks to strategic buyers, private equity firms, and other investors.
Identify and engage with the most motivated and qualified buyers
We don’t post your business online and hope someone finds it. We proactively identify buyers who are a strategic fit.
Create competitive tension to maximize offers
Once we’ve engaged buyers, we run a structured, confidential process that encourages competition. Multiple parties evaluating the business at the same time creates urgency and drives stronger, cleaner offers.
Maintain confidentiality, control, and optionality throughout the process
From start to finish, you remain in control. We work behind the scenes to protect your confidentiality, control the flow of information, and keep the process moving at your pace.
When To Get Help
Knowing how to price a business for sale is just one part of a larger equation. Even experienced business owners can find the exit process overwhelming. Getting help early can make the difference between a frustrating experience and a successful, well-structured exit.
An experienced M&A Advisor brings market insight, negotiation leverage, and a structured process that keeps momentum moving.
Final Thought: Control the Process, Not the Price
You can’t dictate what someone will pay for your business. But you can control how the business is presented, who sees it, and how they compete for it.
At Marsh Creek, we believe in helping owners exit on their terms — with clarity, confidence, and no regrets. If you’re considering a sale and want to understand what your business might be worth in the eyes of the market, we’re here to help you take that first step.
