A small software company came to me trying to figure out what to do next.
Sports training software. Charging $16.50 a month. About 5,000 customers, just coming out of beta. Revenue around a million dollars, barely profitable.
They’d talked to a few bankers to get a sense of what the business was worth, and got wildly different answers.
- One said the business was too small and risky, worth less than a million.
- Another said, since it was software with real revenue, maybe a 3x multiple, around $3 million.
- A third said fast-growing software could get a big EBITDA multiple, closer to $2.5 million.
Three bankers, three different numbers, all based on the seller’s own financials.
Enter the Real Buyer
Around that time, another company in the sports space was in early talks with the founders. This one was big. Six hundred thousand families already paying them for seasonal sports programs, spring baseball, fall football. A great business, but with one problem: seasonality. Almost all their revenue landed in two short bursts a year, and they wanted something that kept families engaged, and paying, in between.
Now picture the small software company sitting across from them, saying something like this:
“You need recurring revenue. Your families want to keep training their kids at home with what they learned on the field. Conservatively, even 10% of your 600,000 families adopting this software is 60,000 customers. At $16.50 a month, that’s over $12 million in year one alone, and it only grows from there.”
Maybe they don’t offer $12 million immediately. But notice how the entire conversation changed.
They stopped using their own numbers to sell themselves. A million in revenue, barely profitable. Instead, they showed the buyer what happens if the buyer owned them.
That’s buyer math. It’s not about your numbers. It’s about what you unlock for someone else.
The Actual Lesson
Most of us walk into conversations about our business talking about our own numbers. Last year’s revenue, this year’s growth, our trends, all of it looking backward. But the real value isn’t in what you’ve already done. Buyers are paying for what happens next.
That’s the whole shift. Stop asking “what is my business worth.” Start asking “who needs, or has to have, what I’ve built?” The real value is what you unlock for buyers, not what you’ve already unlocked for yourself.
Try This
Pick three companies or industries you’ve never seriously considered as buyers. Not competitors, think adjacent.
- Who’s seasonal where you’re steady?
- Who has the customers but is missing what you built?
- Who’s trying to break into a space you already stand in?
For each one, write down a single reason why they’d want what you’ve built. You don’t need proof yet, just a real theory worth testing.
The founders who actually do this are the ones who end up in a $12 million conversation instead of a $1 million one, using the exact same business.
Your numbers got you this far. Someone else’s math is what gets you the rest of the way.
Want help finding your $12 million conversation? See how ExitDNA gets you there →
— Mac
