How to Maximize the Value of Your Business

By Doug Zeisel and Dave Costello,

TCV Growth Partners

Many business owners wait way too long before considering how to maximize the value of their business.  When they start their business, they typically aren’t thinking about an exit that may take place 30 years in the future. And along the way they are usually are consumed with either growing the business or putting out fires.  Uh-Oh, Trouble ahead!

It seems like only yesterday when you started the company and here you are getting ready to retire.  But is your business ready? After all, it just might be your biggest asset and a path to that dream retirement your wife has always hoped for.  But is your business ready for your retirement?

Here’s what you should do ASAP to ensure you get the maximum payout for yourself and any stakeholders:

First – Along the way to building the business you should always have the goal of creating a business that could operate independently of your day to day involvement.  I was recently asked to perform a valuation of a business by the owners.  So, I met with them to learn more: why they wanted a valuation and what the business was all about.  Here we go – the wife was more than ready to retire. She worked almost 70 hours a week “in the business”, in operations to ensure success. And her husband put in the same amount of time doing things like accounting, website maintenance and sales support.  So if they left the business, it would collapse unless they could find a buyer that only wanted their online sales platform and the retail storefront that supported half their sales.  A valuation was not in the cards. I advised them to outsource the accounting and website maintenance and find someone to handle storefront operations so they could focus on being the board of directors. The lesson from this is that as you grow your business, you need to position it to run independently of your day to day involvement.

We like a saying from Tony Robbins that makes a ton of sense.  He said: “Running your business with the intent to sell (real or not, now or later) will make you more strategic, more efficient, and more profitable. You’ll see with a different lens.”  What he means is that you should always be thinking about the decisions you make and whether they will add value to your business. 

Second – As your business grows, the processes you use to operate the business will change. You will add new ones and modify others to reflect the demands of the present. In order to make your business attractive to a buyer, be sure to have systems in place to ensure a smooth transition for the buyer. These systems need to be well documented so everyone can understand what needs to be done to keep the wheels turning. The documentation should include departments, key managers and a description of the processes.  When possible use KPIs to keep operations running smoothly. Documenting systems will ensure a smooth transition to make your business an attractive acquisition, thus increasing its value.

Next – Make sure your company's financial house is on order.  Can you produce finance statements that will survive an audit? While you may say that you never have had to face an audit, the fact is that when you try to sell your business, the buyer will require a review of financial statements and supporting documentation that is very similar to an audit. Consider paying for a “Quality of Earnings” audit ahead of time.  Most buyers will want to have something like this in hand and if you can hand them one before they ask for it that will show you are serious and you’ve invested in the process.

Back to systems; make sure you have systems in place for managing Accounts Receivable, Payroll and other vital processes that are tied to money. Furthermore, you should have a system to forecast and manage cash flow. And don’t forget budgeting – a key to managing costs, margins, and projects.

Be sure to take a look at what levers you can pull along the way to increase the value of your business.  Most or many businesses trade on a multiple of EBITDA.  What can you do to improve your company's EBITDA such as Increase revenues, or reduce SG&A expenses as a % of revenue?  A higher EBITDA means a higher valuation.  Another issue is the Balance sheet of your business. Make sure your balance sheet is healthy using ratio analysis of key items like cash (quick ratio and current ratio) and be sure to look hard at Accounts Receivable – don’t be carrying un-collectable debt on the balance sheet and while you're at it, see if you can improve the days outstanding of your A/R.

Don’t forget your employees – Hopefully over the years you have created a work atmosphere where your employees understand the company’s mission and all are pulling the oars in the same direction.  A sound corporate culture will help the buyer feel confident that they are not buying into a mess. Furthermore, when the buyer does due diligence and talks to key managers, you want them to be positive about their work experience. So please cultivate a positive company culture embodied in trust and communication.

Last - Selling a business is like a second full time job on top of the job you already have running the business.  Be prepared for the grind. Need help? TCV has resources that can help. Whether it's putting systems in place, cleaning up the accounting records, or increasing revenue, we are here to help. For more information contact Dave@TCV-Growth.Partners or Doug@TCV-Growth.Partners

Copyright © 2025 TCV Growth Partners