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- Unlock the EBITDA Secret...
What’s up everyone,
Six of the most powerful letters in the business world.
If you’re evaluating an acquisition or preparing your own business for sale, you MUST know this financial metric inside and out.
Be honest, do you know what EBITDA means? |
Regardless of your answer, you may still have questions. Questions that need immediate clarification.
Where should you turn?
CFO Made Easy helps home and trade service business owners scale past $5M–$10M with part-time CFO services that improve cash flow, profitability, and decision-making.
And of course, they can also provide all the acquisition guidance you need (whether you’re buying or selling).
Visit CFO Made Easy to schedule your free 45-minute Financial Insight Session.
Resources
Before I give you my thoughts, here are some additional resources for those “deep learners” among us (all EBITDA-related).
EBITDA: The Number Buyers Actually Care About
If you’re buying or selling a business, EBITDA is the number that matters.
It’s not about revenue.
It’s not about profit.
It’s about how much cash the business truly throws off…after operations, before financial baggage.
That’s why smart buyers strip away things like:
Interest payments (you’ll likely finance it differently)
Taxes (those change post-sale)
Depreciation and amortization (non-cash expenses tied to old assets)
What’s left is a cleaner look at operational performance.
Example time:
You’re evaluating a plumbing business. Their P&L shows:
$1.5M revenue
$500K labor
$300K materials
$200K in office wages, marketing, rent, software, and fleet
$100K interest, $50K depreciation, $50K amortization
You’d add back those last three and get an EBITDA of $400K.
Now apply a multiple. In home services, 3× is common. That puts the business value at $1.2M.
So forget profit margins and top-line fluff. When it comes to valuations, EBITDA drives the number. Know it, calculate it, and use it.
More Leads = More Revenue
It’s pretty simple when you think about it.
Generate more leads and make more money. So, the only question is: how do you boost lead volume?
You get creative. That’s how.
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Best yet, there’s a 14-day free trial available. All you gotta do is sign up and watch the leads roll in.
Tell Me What You’re Thinking
How do you feel about today's newsletter? |
Enjoy the weekend. I’ll be back Monday with another edition of the JackQuisitions newsletter.
👊 John
Disclosure: This newsletter includes sponsored content. However, all opinions expressed are entirely my own.
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