Small Business Focus

How to value your business

Your business is most likely your largest asset.

It’s important to know what it is worth.

However, valuing your business can be a complex task.

The Money Show’s Bruce Whitfield interviewed Pavlo Phitidis, Director and CEO of the Aurik Business Incubator.

Phitidis talked about how to value your business.

Scroll down for quotes from the audio below.

96.4% of businesses started in South Africa never gets sold.

Pavlo Phitids, Aurik Business Incubator

If you don’t build your business into an ‘asset of value’ you won’t get a buyer.

Pavlo Phitids, Aurik Business Incubator

When someone sets his mind on buying a business; the valuation gets very emotive.

Pavlo Phitids, Aurik Business Incubator

A ‘multiple’ is a lazy way of valuating.

Pavlo Phitids, Aurik Business Incubator

The further into the future you can see the business existing and generating profits the higher the valuation.

Pavlo Phitids, Aurik Business Incubator

It’s not about revenues! Look for ‘free cash’; what’s left at the end of the month.

Pavlo Phitids, Aurik Business Incubator

A R1000 today isn’t the same as R1000 next year. You need to discount back to the present.

Pavlo Phitids, Aurik Business Incubator

You buy a business for its profit.

Pavlo Phitids, Aurik Business Incubator

If you don’t build a business based on systems; will the business continue without you?

Pavlo Phitids, Aurik Business Incubator

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This article first appeared on 702 : How to value your business


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