We’ve recently analyzed the latest data from users of The Value Builder System™ and the findings present an interesting snapshot of the current value of privately held businesses. Below are some of the highlights:

The Business Liquidity Index (BLI) has fallen to 90.8 down from 105.8 last quarter.

Each quarter, we measure the proportion of business owners that received an offer to buy their business and express the proportion as an index, 100 being the average. The BLI rose from 81.8 to 105.8 for the quarter ending June 30, 2016 but has fallen to 90.8 for the quarter ending September 30, 2016, showing that, compared to the previous quarter, a lower proportion of business owners have received an offer to buy their business.

Average offer multiple slips to 3.435 times pre-tax profit.

Moving in lockstep with the BLI, the average offer the users of The Value Builder System™ received in the last quarter has slipped from 3.8 times the pre-tax profit in Q2 of 2016 to 3.435 in Q3, 2016. The BLI and average offer multiple usually move in the same direction, since very active markets tend to drive up offer multiples and when less offers are made, multiples go down.

Our latest analysis includes data from more than 25,000 users of The Value Builder System™ from around the world. Of the business owners surveyed, 96% had revenue (annual turnover) of less than $20,000,000, while 4% had revenue in excess of $20,000,000. Findings are considered statistically accurate +/-0.81%, 19 times out of 20.

To view the excerpt from The Sellability Tracker Q3 2016 click here.