Using the Market Pulse Survey results, we can identify common buyer personas for each industry segment for the first quarter in 2019.
$5MM – $50MM
Buyers in this segment are largely existing businesses (strategic buyers) and private equity firms. These buyers target businesses that represent strong investment opportunities and/or strategic growth opportunities through vertical or horizontal add-ons. Most of these buyers are based 100 miles or more away from the seller.
– Buyer type: private equity: 32% | existing businesses: 38%
– Location: over 100 miles: 55%
– Motivation: strategic growth: 33% | investment: 27%
$2MM – $5MM
Buyers in this segment are mostly strategic entrepreneurs. The second highest segment is most likely to be existing businesses looking to grow through acquisition. Buyers here trending toward being more than 100 miles away.
– Buyer type: serial entrepreneur: 30% | 1st time: 20% | existing business: 18%
– Location: within 20 miles: 26% | over 100 miles: 43%
– Motivation: strategic growth :40% | investment: 16% | buy a job: 13%
$1MM – $2MM
Buyers in this segment are almost evenly split between with existing businesses edging out first-time owners, followed by serial entrepreneurs. Their motivations cross three consistent themes: buying a job, growth through acquisitions and better ROI than other investments. Most of these buyers are being sourced more than 100 miles from the seller.
– Buyer type: 1st time: 33% | serial entrepreneur: 30% | existing business: 36%
– Location: within 20 miles: 23% | over 100 miles: 33%
– Motivation: strategic growth: 19% | investment: 12% | buy a job: 29%
$500K – $1MM
Buyers in this segment also tend to be first-time owners, looking to buy a job, within 20 miles of their home. About a quarter of these buyers, however, will be serial entrepreneurs and another quarter will be existing businesses looking to grow through acquisition.
– Buyer type: 1st time: 56% | existing business: 16% | serial entrepreneur: 25%
– Location: within 20 miles: 50% | over 100 miles: 22%
– Motivation: buy a job: 38%
< $500K
Buyers in this market segment tend to be first-time business owners looking to “buy a job” by acquiring a business that can provide sufficient income/owner’s salary. These buyers are usually located with 20 miles of the business they acquire.
– Buyer type: 1st time: 47% | serial entrepreneur: 33%
– Location: within 20 miles: 48%
– Motivation: buy a job: 51%
