The Myth:
The business is worth whatever someone is willing to pay.

The Reality:
Price reflects a specific buyer’s motivation; value reflects a market of hypothetical, rational buyers. Unique buyer synergies (e.g., a competitor paying more to eliminate competition) don’t define fair market value.

Why It Matters:
In SBA lending and most fair market valuation settings, strategic premiums aren’t included.

Practical Tip:
Base valuations on what a hypothetical willing buyer would pay, not on one enthusiastic or strategic buyer’s price.