Left Lane Associates

This article highlights how unreliable and inconsistent data can lead to a much lower purchase multiple. When a buyer’s diligence team asked for monthly revenue by customer segment, the prospective seller’s data existed across three systems: in Salesforce, in QuickBooks, and within internal Excel spreadsheets. The full picture took six weeks to compile, and the inconsistencies that existed between the three systems eroded enough buyer confidence to knock $8 million off of the purchase offer. While the business itself was solid, the data wasn’t.

According to a study by EY, 72% of businesses lack the reliable, consistent data needed to support exit readiness. The fix isn’t expensive relative to the upside, as it often requires adding an independent finance function, clean KPIs tracked consistently over several years, and a modern ERP (Enterprise Resource Planning software that automatically integrates and reconciles financial data across the business). However, these additions take time to implement, which means the time to start is well before you decide to or need to sell.

Find out more: https://www.entrepreneur.com/money-finance/how-to-remove-the-hidden-barriers-that-jeopardize-your-exit/501896