Resource for advisors
The Broker Opinion of Value
A Broker Opinion of Value is a written, market-grounded estimate of what a privately held business would likely sell for today, prepared by brokers who transact in that market. For any client sent to us by an advisor, it is complimentary.
Alamo Brokers of Texas · Business and property sales since 2002 · San Antonio (HQ), South Central Texas
Most owners carry a value in their head. It came from a competitor's rumored sale, an industry rule of thumb, or a number they need in order to retire. The Opinion of Value replaces it with something a buyer and a lender would recognize, which is the only version that matters once the business goes to market.
What goes into the Opinion of Value?
The work begins with the financials: three years of tax returns, internal statements, and a current interim period, reconciled against each other. From there we build adjusted earnings — seller's discretionary earnings or EBITDA depending on the size and the likely buyer — by identifying owner compensation above market, non-recurring items, discretionary personal expense, and any occupancy cost that differs from market rent.
- Adjusted earnings and the documentation supporting each adjustment
- Comparable transaction data and multiples for the industry and size range
- Asset base, equipment condition, leasehold and real property considerations
- Owner dependence, customer concentration, recurring revenue and the transferability of the business
- Financeability — whether the cash flow supports acquisition debt at a realistic price
The output is a range, not a single number, with the reasoning shown. Two businesses with identical earnings can be a full turn apart on multiple because one runs without the owner and the other does not.
What the Opinion of Value is not
It is not a certified business appraisal. A certified appraisal is a formal engagement performed to a recognized standard for a specific purpose — a filing, a contested matter, a court. The Opinion of Value is a broker's view of market price for planning and pre-market decisions. When your matter requires the formal product, we will tell you plainly, and we will not attempt to substitute for it.
Our standing offer to you
A complimentary Broker Opinion of Value for any client you send us.
No fee. No obligation to list. No engagement letter. Send us an owner who is thinking about selling and wants to know what their company is actually worth, and we prepare it at no charge — a real number instead of a rule of thumb, with you still the trusted advisor in the conversation that follows.
We ask for a short intake first, so the number we produce is worth the paper it is on. Businesses under $100,000 in Seller’s Discretionary Earnings, and businesses with less than five years of documented history, are more difficult to sell and to obtain third-party financing for, and we will tell you that early rather than late.
You make the introduction, and you stay on every conversation from there. We copy you on what we send your client and on what comes back. Nothing about the relationship happens around you.
And no referral fee — in either direction. We do not pay them and we do not ask you to accept one. You are compensated by the client work the deal creates on both sides of it.
Credentials behind the work
Alamo Brokers of Texas has been selling businesses since 2002. Stefan Lagmark has been a member of the Institute of Business Appraisers (IBA) since 2004, and he regularly performs limited independent business valuations.
The numbers are backed by solid industry data analysis, as well as hundreds of closed transactions.
Confidentiality
Everything is handled under confidentiality and non-disclosure agreement. Nothing is disclosed to any buyer and no client or business is ever named publicly.
When is it a paid engagement?
The complimentary Opinion of Value exists because it usually leads to a relationship to sell the business when the time is right. Where the valuation is the entire purpose of the work — a partner buy-out, a divorce, a shareholder dispute — it is a paid standalone engagement, quoted before any work starts.
Questions advisors ask
- Is a Broker Opinion of Value a certified business appraisal?
- No. It is a broker's market-based indication of likely selling price. It is not a certified business appraisal and is not a substitute for one where a filing, a court or a governing document requires a formal appraisal.
- What does it cost?
- Nothing when it comes to us through a referring advisor. There is no engagement letter and no obligation to list. Standalone engagements, such as partner buy-outs and divorce matters, are a paid service.
- What do you need from the owner?
- Three years of tax returns, internal financial statements including a current interim period, any recasts that apply, and a short conversation about the owner's role in daily operations. If the owner decides to move forward with a listing we will ask for more, but not for this.
- How long does it take?
- Typically one to two weeks from receipt of complete financial information, depending on how the books are kept.
Let us work with one of your clients. You won’t regret it.
Call 210.418.4840 or email info@alamobrokersoftexas.com
alamobrokersoftexas.com · San Antonio (HQ), South Central Texas
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