ExitVision

An immediately addressable market of >$1 billion should easily support significant growth for most small and medium-sized businesses and will be looked upon favorably by potential buyers.

An immediately addressable market of $500 million-$1 billion should easily support significant growth for most small and medium-sized businesses

An immediately addressable market of $250 million-$500 million should easily support significant growth for most small businesses, but medium-sized businesses may attract more scrutiny if they propose high growth rates in a market of this moderate size.

An immediately addressable market of $100-$250 million is relatively small and willl necessarily limit a buyer's growth aspirations for your company unless you can demonstrate that adjacent markets are readily accessible.

An immediately addressable market of <$100 million is very small. While it is possible to have a terrific, profitable small business in such a small market, buyers will discount your valuation unless you already have a very strong leadership position in your niche with opportunities to break out.

Explosive or fast growth in your underlying market will support a high valuation for your business if your business is poised to take advantage of that growth. It will also beg the question from buyers: "Why sell now?"

Slow or otherwise limited growth in your underlying market will support a fair valuation for your business, but you'll have to show the value elsewhere.

A slowly declining underlying market will hurt your valuation unless you can show your business can overcome the broader market dynamic.

A collapsing or rapidly shrinking underlying market for your business will definitely hold back your valuation. To get buyers excited you'll have to highlight a credible path to recovery.

High barriers to entry suggest that it will be extremely difficult or expensive for new competitors to enter your industry and to achieve your business' level of market success. High barriers to entry are always good and support higher valuations.

Moderate barriers to entry suggest that the difficulties facing new competitors in your business will successfully turn away many potential challengers, but that a committed challenger can surmount those difficulties and effectively compete in the near- to medium-term.

Businesses with limited or insignificant barriers to entry rarely grow to meaningful size due to the ability of new entrants to erode the market position of incumbents. Potential buyers will be wary of such businesses, and valuations will be discounted.

Businesses with limited or insignificant barriers to entry rarely grow to meaningful size due to the ability of new entrants to erode the market position of incumbents. Potential buyers will be wary of such businesses, and valuations will be discounted.