In Exit Strategies

Using the Market Pulse Survey results, we can identify common buyer personas for each industry segment.

$5MM – $50MM
Buyers in this segment are split between 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: 38% | existing businesses: 38%
– Location: over 100 miles: 56%
– Motivation: strategic growth: 57% | investment: 25%

$2MM – $5MM
Buyers in this segment are most likely to be existing businesses looking to grow through acquisition. However, first-time buyers still represent a quarter of the buyers. Buyers here are just as likely to be sourced locally as farther afield.

– Buyer type: existing business: 29% | 1st time: 24% | private equity: 24%
– Location: within 20 miles: 35% | over 100 miles: 24%
– Motivation: strategic growth :53% | investment: 24% | buy a job: 18%

$1MM – $2MM
Buyers in this segment are still most likely to be first-time owners, followed by serial entrepreneurs and existing businesses. Their motivations cross three consistent themes: buying a job, better ROI than other investments, and growth through acquisition. Again, most of these buyers will be sourced within a 20-mile radius of the seller.

– Buyer type: 1st time: 38% | serial entrepreneur: 32% | existing business: 26%
– Location: within 20 miles: 50% | over 100 miles: 29%
– Motivation: strategic growth: 35% | investment: 29% | 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: 46% | existing business: 26% | serial entrepreneur: 22%
– Location: within 20 miles: 56% | over 100 miles: 20%
– 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: 50% | serial entrepreneur: 34%
– Location: within 20 miles: 75%
– Motivation: buy a job: 53%

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