An independent pharmacy listed for $800K on $200K in SDE. But: ❌ Seller filled 98% of prescriptions❌ No replacement wage or pharmacist transition plan❌ PBM reimbursements declining 3 years straight❌ $60K in addbacks included 'consulting' to his own C-corp ✅ After market comp, buyer pharmacist wage, and normalization, value = ~$370K 📌 No pharmacist, no … Continue reading ⚠️ Red Flag Case Study: The $800K Rx Mirage

💊 Pharmacies can post steady revenue—but valuation pitfalls are everywhere. Common traps: PBM reimbursements below cost Owner is the primary pharmacist No non-compete from departing seller Prescription volume inflated by short-term scripts 📌 Rule of thumb: A buyer without a license can’t step into the seller’s shoes—and value must reflect that. ✅ Normalize cash flow … Continue reading 🧠 Valuation Insight: Don’t Let the Scripts Fool You

🧾 Hot off the server: Our IT MSP Valuation Checklist—built for SBA 7(a) underwriting of tech service providers. Includes: ✅ Owner dependency & tech labor normalization✅ Contract type + termination clauses✅ Software licensing, RMM tools, and CapEx traps✅ Red flags: no SOPs, no backup staff, or vague SLAs 💻 Click here to grab your copy.

A seller priced an MSP at $1.2M based on $325K of “recurring” EBITDA. But: ❌ 83% of contracts were cancel-anytime❌ Owner handled all escalations & major clients❌ Licensing for RMM + security tools not transferrable❌ No backup engineers, SOPs, or client portal 📉 True transferable free cash flow: ~$85K🧮 Revised value: ~$520K 📌 MSPs need … Continue reading ⚠️ Red Flag Case Study: The $1.2M Illusion

🖥️ MSPs often boast “recurring revenue”—but dig deeper. Consider: Are contracts fixed-fee, usage-based, or T&M (time & materials)? Do contracts auto-renew or cancel anytime? Is the owner the primary tech or sales lead? Are software/tools included or personally owned? 📌 Rule of thumb: “Recurring” only matters if it's documented, priced right, and transferable. ✅ Adjust … Continue reading 🧠 Valuation Insight: IT Managed Services Providers (MSPs)-Not All Recurring Revenue Is Created Equal

📝 Now available: Our NEMT Valuation Checklist for SBA 7(a) underwriting. Includes: ✅ Owner driving risk + replacement comp✅ Medicaid and contract payer mix analysis✅ CapEx for fleet age, safety compliance, and GPS✅ Red flags: no EHR integration, denied claims, or solo-driver ops 🚐 Click here to grab your copy.

A NEMT business claimed $175K in adjusted cash flow and wanted $600K. But: ❌ Owner drove 5 days a week❌ Vehicles were over 12 years old❌ Medicaid reimbursement delays not considered❌ No backup drivers or dispatch software Real FCF: ~$42K📉 Revised value: ~$260K 📌 Mileage doesn’t equal value—especially if the wheels fall off post-sale.

🚐 NEMT businesses can appear cash-flow strong—but risk is hiding in the details. Watch for: Heavy reliance on Medicaid or brokered contracts Delayed reimbursements or denials Owner driving the majority of shifts CapEx and repairs for aging fleets not accounted for 📌 Free cash flow means nothing if it’s based on unpaid invoices or a … Continue reading 🧠 Valuation Insight: NEMT (Non-Emergency Medical Transportation) Revenue Isn’t Always on the Meter

📋 New resource drop: Our Test Prep & Tutoring Valuation Checklist—designed for SBA lenders underwriting education businesses. Includes: ✅ Revenue seasonality adjustments✅ Instructor vs. owner comp normalization✅ Addbacks tied to IP, curriculum, and family labor✅ Red flags: no academic calendar, all 1:1 sessions, or heavy owner teaching load 📚 Click here to grab your copy.

A tutoring business claimed $140K in "cash flow," asking $350K (2.5x). But: ❌ Owner taught 85% of classes❌ “Marketing” addback ❌ 4-month summer lull unadjusted❌ No replacement cost for part-time instructors After seasonality and staffing normalization, true FCF: ~$58K📉 Revised value: ~$145K 📌 Cash flow that disappears in July isn’t sustainable. ✅ Moral: Managing properties … Continue reading ⚠️ Red Flag Case Study: The $350K Bubble