Investment services professionals are essential in educating an aging generation of business owners on how to best leverage their successes and safeguard themselves from financial downturns in a volatile economic environment. Industry data shows that most small businesses sell for only about 2–3× seller’s discretionary earnings (SDE) or cash flow, with revenue multiples for “Main Street” businesses often averaging around 0.6–1× annual revenue.[1](#) Standing alone, that multiplier may be far from enough to lead a comfortable post-working-age lifestyle.
According to Rebecca Gustafson, Founder and Wealth Management Advisor with Eternal Wealth Partners, as few as 20 percent of businesses have a successful exit strategy—an insight supported by findings from the Exit Planning Institute, which reports that only 20–30 percent of businesses that go to market actually sell, and that nearly 80 percent of owners lack a written transition plan.[2](#) With more than 2.1 million Baby Boomer-owned businesses expected to be sold or transferred in the coming decade,[3](#) it is more important than ever for business owners to diversify their assets and properly value the enterprise they’ve built.
Please reach out to Becky at becky.gustafson@nm.com to discuss how you can maximize your investment strategy as a business owner.
Sources: [1](#) BizBuySell Industry Valuation Multiples Report, 2024.[2](#) Exit Planning Institute – State of Owner Readiness Report, 2023. [3](#) Project Equity – Baby Boomer Business Owners Data Brief, 2023.
All investments carry some level of risk, including loss of principal invested. No investment strategy can assure a profit and does not protect against loss in declining markets.
Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company (NM) (life and disability Insurance, annuities, and life insurance with long-term care benefits) and its subsidiaries, including Northwestern Mutual Investment Services, LLC (NMIS) (investment brokerage services), a registered investment adviser, broker-dealer, and member of FINRA and SIPC. NM and its subsidiaries are in Milwaukee, WI.
Rebecca Gustafson uses Eternal Wealth Partners as a marketing name for doing business as a representative of Northwestern Mutual. Eternal Wealth Partners is not a registered investment adviser, broker-dealer, insurance agency, or federal savings bank. Rebecca Gustafson is an Insurance Agent of NM. Investment brokerage services provided by Rebecca Gustafson as a Registered Representative of NMIS.
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985-290-6745 • eternalwealthpartners.nn.com
