Focuses on fair market value of tangible assets (equipment, real estate) minus liabilities, plus intangible "goodwill". 2. Due Diligence Checklist
Often used for smaller books of business, where the value is roughly 1x to 1.5x annual commissions .
The industry standard. Agencies typically sell for 8x to 12x their earnings before interest, taxes, depreciation, and amortization. High-performing agencies with 25-30% profit margins command higher multiples.
Before finalizing a deal, you must verify the health of the "book" (the list of active policies):
Agencies are primarily valued based on their profitability and recurring revenue. Common methods include:
Focuses on fair market value of tangible assets (equipment, real estate) minus liabilities, plus intangible "goodwill". 2. Due Diligence Checklist
Often used for smaller books of business, where the value is roughly 1x to 1.5x annual commissions .
The industry standard. Agencies typically sell for 8x to 12x their earnings before interest, taxes, depreciation, and amortization. High-performing agencies with 25-30% profit margins command higher multiples.
Before finalizing a deal, you must verify the health of the "book" (the list of active policies):
Agencies are primarily valued based on their profitability and recurring revenue. Common methods include:
