An Offer in Your Inbox Is Not a Price
Owners here get cold emails from private equity analysts, search funds and roll up groups every month. Some are serious. Most are fishing for a cheap first look.
A single buyer sets the terms when nobody else is bidding. The price only becomes real when several qualified buyers see the same numbers and have to compete for the company.
That is the job of a sell side broker: prepare the numbers, find the buyers, keep your name out of it until each one signs an NDA, and make them put offers on paper side by side.
The first offer tells you a buyer is interested. The third one tells you what the company is worth.
What Bay Area Buyers Pay For
Buyers pay for earnings they believe will continue after you leave. For most owner run companies that is seller’s discretionary earnings, or SDE. Once there is a management team in place, buyers switch to EBITDA.
The multiple applied to those earnings depends on risk. These things push it up:
- Revenue that repeats under contract or subscription
- No single customer above roughly a fifth of sales
- A team that handles the day without you in the room
- Clean books that tie to the tax returns
- A lease with years left on it and a landlord who will consent
Our page on business valuation walks through how add-backs and recasting change the number.
Why Is Selling Here Slower Than Owners Expect?
California adds steps that owners in other states never see. Many asset sales need a bulk sale notice recorded and published before closing. Buyers want a tax clearance from the CDTFA before they release the money.
In San Francisco almost every small company leases its space, so the landlord’s consent to assign the lease often decides the closing date. Restaurants and bars add a liquor license transfer on top of that.
None of this is a reason to wait. It is a reason to start the paperwork early. Our guide to selling a San Francisco business lays out the order things happen in.
Who Is Buying Companies in San Francisco?
The buyer pool here is deep and impatient. Individual buyers with SBA loans of up to $5 million look for steady service companies. Competitors buy to add customers, crews or licenses.
Private equity groups and family offices on both sides of the bay hunt for platform companies and smaller add ons. Strategic buyers, including tech companies, buy teams and products outright.
Each group values a company differently. A broker who knows which ones are active in your sector can put the right buyers in the room.
The Sectors We See Most
Restaurants and bars, software companies, agencies, property managers, cleaning contractors, veterinary practices, auto repair shops and ecommerce brands all have their own pages, listed further down.
If yours is not listed, the same principles apply.
We also work with owners across the region, from Oakland and the East Bay to the Peninsula and Marin.
Is a $1 Million Company Big Enough?
Yes. Our partner focuses on companies with about $1 million or more in yearly sales. Below that, a full brokered sale often costs more than it adds.
Above it, the difference between a quiet, competitive process and a rushed sale to the first caller can be larger than a year of profit.
Brokers are usually paid a success fee when the deal closes. BizQuest puts the common rate near 10% for deals of $1 million or less, with larger deals on a sliding scale.
The estimate itself costs nothing, and how the referral works is spelled out here.
Ready for a number? Use the estimate form on this page or call (415) 555-0163. Nothing you send is shared with buyers, and there is no obligation to sell.