This is how you value an AI and data services company
1. High growth is important
High growth and, more importantly, high growth expectations are clear advantages for the valuation of your company. After all, if your company grows strongly, this will strengthen the buyer in the belief that he can quickly earn back his investment.
2. Recurring turnover pays off
A point to note is that much of what AI and data services companies do project based is. Services are tailor-made for the customer. It is then difficult for a buyer to estimate whether the customer will come back again for a new project.
The enterprise value of your AI and data services company will therefore increase greatly if you as an entrepreneur can package the services in a subscription form, preferably a subscription in the cloud. This is how recurring revenue.
3. Simple products are key
Related to this: it snackable making a complex product is key to accelerated growth. The simpler the product, the easier it becomes for the company to scale up and also generate recurring revenue.
Growth prospects, recurring revenue and a simple product: these are the most important elements for the valuation
Finally, six elements that a potential buyer will definitely look at
- Innovation. It is essential in this industry.
- Is there a blue ocean or a completely new market? There is still little competition in new markets.
- Research & Development costs. How high are they?
- How risky are the projects?
- Does the company know intellectual property (IP) really monetize? Does all innovation really lead to good products?
- Are there so-called micro-vertical focus? As competition increases, a deep focus on a particular customer group can be valuable.
Now that you know what potential buyers are looking at, our question to you is: are you ready to sell your business? What else is needed? Are you overlooking anything else? For an answer to these and other questions, make an appointment with us. Together we really prepare your company for a Dream Exit.
Successful exit Business Forensics
Business Forensics has completed the full 4-Step Exit Program. After a short but intense period of reflection and the implementation of a number of improvements, we entered the market.
Read more about this case here
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Now that you know what potential buyers are looking at, our question to you is: are you ready to sell your business? What else is needed? Are you overlooking anything else? For an answer to these and other questions, make an appointment with us. Together we really prepare your company for a Dream Exit.
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how we can help you with your Dream Exit.