Question:
My partner and I are trying to determine the value of our healthcare IT consulting business.
We have been in business for 10 years and have grown consistently. We now have 30 full time employees and revenues between $5 million - $6 million. Since we are a niche services consulting company, we believe that we will be worth more than the average IT consulting company for a specific market of possible buyers, but may have a limited pool of companies that would be interested. Can you please provide a multiplier or ballpark range that we should expect to get at this time? - Andrew Splitz, Boston
Answer:
Being niche specialist does make your business more valuable, according to Scott Bushkie, president of Cornerstone Business Services in Green Bay, Wisc.
‘The more defendable the niche, the less risk involved, the higher the value,’ he says.
To get a general idea of what comparable businesses are listed for, you can look somewhere like Business Valuation Resources, suggests Andy Cagnetta, CEO of Transworld Business Brokers Inc. of Ft. Lauderdale, Fla. However, he cautions: ‘With a business like yours, seeking a strategic buyer, the usual multiples go out the door.’
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