Is QoE Light enough for a $2 million to $3 million acquisition?

On one clean entity with straightforward revenue and no lender relying on the number, yes. Where a lender will rely on it or the working capital peg will be negotiated, most buyers in that band land on Core, because the three-period proof of cash is the item a lender reads first and Light does not carry it, and because Light computes the peg where Core tests it.

How many tests does a business under $2 million of EBITDA actually need?

About twelve tests out of the forty-six a full-scope review runs, chosen by the complexity of the file. The proof of cash, the add-back gates and the journal entry screen stay at any size, and the rest drop until a trigger brings them back, such as concentration over 20 percent or adjustments over 15 percent of EBITDA. In practice that lands on the $10,000 Light for one clean entity and the $15,000 Core once a lender relies on the number.

Are there good quality of earnings providers for under $10,000?

Yes, and the fee is the wrong first question. Published products under $10,000 run from a $3,000 annual review with no bank, tax or payroll reconciliation to a cash proof with a red-flag summary, and neither end of that range is what a lender relying on the number means by a review. Our own screen starts at $5,000 and is credited against a review, and our Light starts at $10,000. Ask any provider which periods the cash proof covers and whether the peg was tested.

Which firms do quality of earnings for deals under $5 million of EBITDA?

Boutiques and regional CPA firms, priced from about $10,000 to $25,000, with most large firms declining the file because it sits under their minimum. LIMESTONE works books of roughly $500K to $5M of EBITDA at fixed fees from $10,000, and a CPA leads every report.

Will my lender accept a light review on a deal under $3 million?

Lenders set their own requirements, so no provider can promise it, and the ones we work with read the three-period proof of cash first, which Light does not carry. Under $3 million no rule requires a report. On a 7(a) loan the SOP still says financial due diligence is required on all change of ownership transactions, and the lender verifies the valuation’s numbers against the seller’s IRS transcripts and underwrites coverage off the last fiscal year or a two-year average. On conventional debt or a seller note the lender sets its own bar. Ask before you buy, and if the answer is Core, buy Core once.

What does a quality of earnings not test at any tier?

Whether the earnings survive the owner leaving. Every financial tier reports owner dependence, relationship ownership and bench depth at a high level and no tier tests those to conclusion, because that takes reference calls, separate management interviews and a quantified revenue at risk. A proof of cash also cannot catch an invoice billed to a friend of the owner, since the money moved and the reconciliation agrees with itself.

Does it cost more when a lender relies on the report?

Sometimes. Light starts at $10,000 on either side, and the fee moves with the counts above. When a lender will rely on the report we carry a liability for that, and a reliance letter to a named lender is priced separately. Information friction matters too: on a sell-side file the client controls the data room, and on a buy-side file you are waiting on somebody with other priorities.

Is a fixed fee always better than hourly?

For this work, yes, and not because hourly firms are doing something wrong. A fixed fee puts the risk of a messy file on the provider, which is where it belongs, because the provider is the one who is supposed to be able to read a trial balance and predict the work. It also removes the incentive to take longer.

Will a cheaper report still be accepted by my lender?

Lenders set their own requirements, so no honest firm can promise you that. They look at who engaged the firm, whether the preparer is credentialed and independent, and whether the earnings figure is supported well enough to underwrite from. On an SBA deal at $3M or more, a report you commissioned also needs a review by one of the lender’s approved vendors.

How fast can you tell me my number?

Usually within a business day of a short call. We answer the counts above, quote one fixed fee, and put the scope in writing before anything starts.

Do you add back the owner's draw when calculating SDE?

Not as a draw, no. A distribution is not an expense, so it never reduced earnings and there is nothing to add back. What you add back is the compensation that ran through payroll for the seat the owner occupies, and only the portion above a market wage for that seat. If an owner takes $520K on a W-2 where a general manager would cost $270K, the add-back is the $250K of excess, plus the employer payroll taxes attaching to it. Get this one wrong in the other direction and you have counted the same money twice.

Do owner drawings shown in retained earnings count toward SDE?

No, and the place they appear is the clue. Retained earnings is a balance sheet account. SDE is an earnings measure built off the income statement, so a movement in equity has no path into it. If you find drawings sitting in an expense account rather than in equity, that is a bookkeeping finding rather than an add-back, and it is worth asking what else has been posted the same way.

Are SDE and EBITDA the same thing?

No, and the gap is usually a market wage for one seat. EBITDA is earnings before interest, tax, depreciation and amortization, with the owner's compensation still in it. SDE adds that compensation back on the reasoning that a single owner-operator will replace it with his own labor, so on our worked example the gap between the two measures is $285.4K, which at a four times multiple is $1,142K of purchase price for exactly the same company. The conventions cross at roughly $1 million of EBITDA, and a lender on an SBA deal underwrites the smaller figure.

Which taxes do you add back?

Income taxes come out because EBITDA is defined before them, and on an S corporation they were the owner's liability rather than the company's anyway. Payroll taxes do not come out, with one exception. The employer payroll tax attaching to an owner-compensation add-back travels with that add-back, because it would not exist at a market wage. Property tax, sales tax and excise tax stay in. They are operating costs and they will arrive on your desk in your first month.

Can bad debt be an add-back?

Rarely, and a claim that it should be is worth testing rather than accepting. Bad debt on a business that sells on terms is an operating cost of selling on terms, and it recurs. A specific, identified, non-recurring write-off of one account that failed for a reason the business will not meet again can clear gate one, and it needs the invoice, the collection file and the reason. What we look at first is the reserve rather than the write-off, because under-reserving overstates earnings and leaves no cash trail, which makes it invisible to a proof of cash.

Is six figures of add-backs against about $200K of net income an SBA problem even if the seller is trustworthy?

The coverage floor answers it, whatever you think of the seller. An adjustment the lender cannot support with its own analysis is ineligible for the coverage test, and at a business purchase price of $3 million or more the lender must use the earnings from the quality of earnings in that test. Where coverage will not support the structure, the loan comes down or you put in more equity to meet the minimum. So each add-back has to clear all three gates in front of a credit committee, and the ones that do not clear come out of the loan. On a business that size the add-backs are most of the earnings, so the review decides the deal.

What are market terms for a seller note on an SBA deal?

For a note that counts toward the equity injection, the terms are not market at all. They are prescribed. Full standby for the whole term of the 7(a) loan, which means no principal and no interest paid. Interest may accrue and be paid once the 7(a) loan is gone. Refinanceable after 36 months in place and current. Seller debt on standby and non-controlling minority equity together may supply no more than half the injection requirement, and that cap now applies across both categories where the prior SOP was silent on the point. A note that is not on full standby can still exist in the deal. It just does not count as equity, and it competes with the bank for the same cash flow. That is where it shows up in your coverage.

Can I use a HELOC as the SBA down payment?

The principle the SOP applies is that borrowed funds count as an injection only where you can show repayment from a source other than the cash flow of the business you are buying. A home equity line serviced out of your salary is a different case from one serviced out of the company's distributions. Lenders treat them differently. We are stating the principle rather than quoting a paragraph at you, because the documentation a lender wants varies by lender and the call belongs to them. Ask in writing before you draw anything.

If I draw the line in May and sign a letter of intent in August, how would SBA know it came from a borrowed source?

Because the file shows it. A lender verifies the source and seasoning of injection funds, and the trail through your accounts is the evidence. Timing is not the variable. What decides it is whether the repayment comes from somewhere other than the business, and whether you can document that. We are not going to tell you how many months of seasoning satisfies a particular lender, because the SOP does not set that number and we would be inventing it.

Can a spouse or partner be the guarantor instead of me?

Guarantees follow ownership rather than preference, and the lender will want them from the people who own the company. Beyond that principle this is a question for your lender and your counsel, and the answer turns on the ownership structure you are proposing rather than on anything we can source for you here.

Can the personal guarantee be removed over time?

Not as a program feature. The guarantee is the structure of the loan rather than a condition that lapses, which is the single most important difference between what you are signing and what a fund signs. Plan on carrying it for the life of the loan. The price you reach for is the price you stay personally behind, which is the real reason the sequence in this guide is worth respecting.

Does SBA allow personal guarantee insurance?

Products exist commercially and we are not the right people to advise on them. What we can tell you is that buying cover does not change the guarantee, the coverage test, or the arithmetic on this page. If you are reaching for insurance to make a deal feel survivable, the finding is the deal. Take the question to a broker and to your counsel, and price it as a cost.

I already paid for a QoE. Do I have to buy another one?

Not necessarily. If your deal is an Initial Acquisition or Business Expansion, the business purchase price is $3 million or more, and SBA receives the application on or after 1 October, the lender must have a report conducted for its benefit. Since the 25 September update the SOP lets the lender use yours, once one of its approved vendors has reviewed it and the review is in the file. Ask your lender whether it will do that before you commission anything else.

Does my sell-side report count?

No. A sell-side report is prepared for the seller, which is the specific thing the SOP excludes. It is still worth having. It shortens the buyer's work and it tells you what will be found before someone else finds it.

Who picks the provider, me or the bank?

The bank, when it engages the report for its own benefit, and most will consider a recommendation. If you commission your own first, you pick, and the bank decides whether to have one of its approved vendors review it. Ask early whether it keeps an approved list.

What if the purchase price is just under $3 million?

Then the mandate does not attach, and financial due diligence is still required on every change of ownership transaction. Remember that the threshold is measured before your equity and any seller note, and that owner-occupied real estate comes out at appraised value first. Deals land on the wrong side of $3 million more often than people expect.

When should the report be ordered?

As early as the lender will allow. It feeds the debt service coverage calculation, so underwriting cannot finish without it, and on a tight timeline it is the item that moves the closing date.

My application is already in. Am I under the old rules or the new ones?

It depends on when SBA received it. SBA’s notice keeps SOP 50 10 8 for applications submitted to SBA through 30 September and applies 8.1 to those received on or after 1 October. On a delegated loan SBA receives the application when your lender requests the loan number, so a number requested in October puts you under 8.1 however long the file sat in underwriting. If your lender sent a non-delegated application to SBA in September, ask which rulebook it is being read under.

I already own a company and I’m buying a second one. Is that an expansion?

Only if your existing business has operated for two full fiscal years under your ownership and the target sits in the same four-digit NAICS Industry Group. Two full fiscal years can run past thirty months if you bought in June. Miss either test and it is an initial acquisition: 1.25 coverage, ten percent down that cannot be reduced, and a quality of earnings report if the business price clears $3M.

SBA’s notice and the SOP say different things about a reliance letter. Which does my bank follow?

The SOP, and then its own credit policy on top. The SOP binds the lender, and on this point it describes only a review by one of the lender’s vendors; the reliance letter appears in the notice that announced the update. A conservative credit team is entitled to insist on the review, so ask your lender directly; its answer is the only one that binds.

What happens if the report comes back below the price I agreed to?

The loan shrinks and the difference lands on you. The appendix is direct about it: if the coverage does not support the valuation and the proposed debt structure, “the loan amount must be reduced accordingly,” and the gap has to be filled with additional equity, which the SOP lets you add, from your own cash or a limited source, to bring the debt down until coverage clears. Where that extra money comes from a limited source such as more seller debt, it goes on full standby for the term; where it comes from you, it is cash you were planning to operate with.

My books are on a cash basis. Is that a problem?

It is a conversion project, not a disqualifier, and it is one of the more time-consuming pieces of the work. Revenue and the cost that produced it land in different periods on a cash basis, so margin appears to move when only timing did. Plan for it rather than discovering it.

The seller says the add-backs are legitimate. Why does the bank disagree?

Usually it does not disagree about the item. It disagrees about the proof behind it. A lender will typically accept adjustments that can be verified as one-time or genuinely owner-related, and decline the ones resting on an explanation. The burden sits with whoever wants the higher multiple.

How far below the broker’s number do these usually land?

There is no honest average, and we will not quote you one before reading your file. What is predictable is the direction and the mechanism: replacement salary at market rather than what the owner paid himself, personal expenses split rather than added back whole, and one-time items tested against the two years either side.

How long does this take?

The work itself is weeks, not months. What sets the timeline is how fast the documents arrive. Files that stall are almost always waiting on a seller, not on an analyst.

Do I need this if my deal is under $3 million?

The mandate does not attach, and financial due diligence is still required on every change of ownership. The threshold is measured before your equity and any seller note, and owner-occupied real estate comes out at appraised value first, so check the arithmetic before you assume you are under it.

How much customer concentration is too much?

There is no single number and anyone who gives you one is describing their own risk tolerance. What we can give you is the dispersion. SBA sets none when it tests the earnings and 20 percent of outstanding receivables when it lends against the invoice. We flag and test at 15 to 20 percent of revenue. Above roughly 30 percent in one account, the question stops being about diligence and becomes a question about whether you want to own a business with that shape, because no amount of testing changes the shape.

What are the maximum acceptable thresholds for customer concentration?

Acceptable to whom is the question underneath this one, and the answer differs by party. An SBA working capital line has a threshold for the borrowing base, and the earnings test has none at all, while a buyer has one set by how much personal guarantee he is willing to carry against a single relationship he did not build. We hold ours at 15 to 20 percent as a trigger to test rather than as a limit to refuse. Get all three numbers on the table early, because they are not the same number and only one of them is written down.

Is it ever okay to buy a business with high concentration?

Yes, and the things that make it survivable are testable before you sign. A contract with a real term and no change-of-control clause, a switching cost the customer would actually pay rather than merely acknowledge, and more than one person inside the account. Then a price that reflects the risk instead of ignoring it. Where those are present, concentration is a feature of the industry. Where they are all absent and the relationship sits with the man who is leaving, you are buying the relationship rather than the business.

Is under 60 percent in the top three acceptable?

It depends on what those three look like under testing, and the framing of the question hides the thing that matters. Sixty percent across three contracted accounts with switching costs and named account managers is a different business from sixty percent across three handshake relationships the owner holds personally. Run the reference calls on all three before you decide. The number is the beginning of the analysis.

What would you have spent more time on during due diligence?

The reference calls, which is also the answer the forums keep giving, because they are simultaneously the cheapest procedure available, the highest-yielding one, and the only part of the work the financial procedures structurally cannot do for you. They are also the first thing a buyer cuts when the ninety days get tight. They also have to be arranged in week two to happen in week five, because they need the seller's consent and his introduction. Cut them and you have bought the earnings without testing whether they travel.

How does a working capital peg work?

You and the seller agree a normal level of working capital for the business, and the price adjusts for whatever is actually delivered at closing against that level. Deliver more than the peg and the seller is owed the difference. Deliver less and you are owed it. The peg itself is usually an average of month-end balances over some window, struck on a cash-free and debt-free basis, which means cash comes out of the calculation and so does every dollar of interest-bearing debt. It goes wrong in two places. The window, and the testing. A three-month window on a seasonal business measures a season. And an untested peg values receivables nobody has aged and inventory nobody's looked at.

What is a working capital peg?

It's the agreed normal level of working capital the seller has to leave in the business. Think of it as the fuel in the tank on the day you take the keys, which is a useful picture right up to the moment somebody asks how much of the fuel is water. Yale puts the consequence better than a definition does: "An inaccurate working capital peg might mean the searcher pays for inventory that is gone by 12:01 AM on the day they take over as CEO."

How do you build a peg when accounts payable is not tracked monthly and only payments are recorded?

The best technical question in the harvest, and it comes up constantly on businesses this size. You rebuild the balance you need from the documents that do exist. For payables, take the vendor statements at each month end together with the check register, and reconstruct the open balance by matching every invoice to the payment that cleared it after that date. It's slow, and it isn't an estimate. For in-transit inventory, work from the purchase orders, the carrier documents and the terms on each order, because the terms tell you when title passed and therefore whose balance sheet it belongs on. Where a month genuinely can't be rebuilt, say so in the report. Use the months you can and widen the window, and claim no more precision than the records support. A peg built on four reconstructed months with the method stated is worth more than twelve months of numbers nobody can source.

How essential is tax diligence on an asset deal?

More essential than on a stock deal. Which isn't what most buyers assume. The logic that an asset purchase leaves liabilities behind holds for most of them. It fails for the ones that attach to the business itself. Sales and use tax, payroll tax and a misclassified workforce all follow the operations. They come with you. The exposure on our worked example runs to a range of $80K to $130K across three categories. Against a ten percent injection, that is a meaningful share of the cash you are putting in.

If I do require tax diligence, what is the minimum scope?

Four things, and all four are answerable inside a week. Not one of them is expensive. State registrations against where the business actually ships, which is the economic nexus question. The payroll register read for anyone paid on a 1099 who looks employee-like. Any local or franchise filing the business should be making and might not be. And confirmation that sales tax collected has actually been remitted, because collected-and-unremitted is money the business is holding in trust for a state, and there is nothing to argue about later. That distinction decides who pays. Anything beyond that is worth buying only if one of those four turns something up. Start there.

Is asking for both a seller note and a five percent escrow holdback double-dipping?

Fair question, and on an SBA deal the instrument is usually the problem. Seller earnouts are prohibited on a 7(a) change of ownership, and the lender's closing escrow is limited to five business days, so a holdback meant to sit for sixty days needs a structure your lender has agreed to. What works is a seller note on full standby, which counts toward the equity injection and becomes refinanceable after 36 months in place and current, a buyer rebate for performance protection, which pays down principal, and a working capital adjustment in the purchase agreement, which since the 25 September update is not a rebate and can stay in the business. Asking for those is not double-dipping.

Who checks whether a business runs without the owner?

Nobody, unless you buy it, and that's the honest answer. A quality of earnings tests whether the earnings are accurate, and the SBA version must also judge whether revenue and margins are likely to hold after the sale, but neither it nor the business valuation tests the handover seat by seat. On an Initial Acquisition or Business Expansion at a $3 million business purchase price your lender requires both, and it requires nothing about owner dependence. So the work is operational diligence, and it is a separate engagement that runs alongside any quality of earnings scope. If you are not buying it, the two procedures that carry most of the value on your own are the reference calls and the owner's calendar for the trailing ninety days.

Any tips for the first face-to-face meeting with a potential seller?

Ask him what he does on a Tuesday. Not what his role is, what he actually did last Tuesday, hour by hour. It's a friendly question and it produces the calendar finding six weeks before you could get the calendar. Then ask who decides a price when he is away, and listen for whether the answer is a name or a shrug. Three things not to do: do not open on price, do not bring a list, and do not tell him what you plan to change. You are there to find out how the business runs and to be somebody he would sell to, and those are the same visit.

Is anyone using AI for due diligence?

We use it, and we'll tell you exactly where. It collects and organizes documents, summarizes long files, and checks our own arithmetic. It does not make the calls, read the room in a management interview, or decide whether a cost recurs. The work on this page is judgment about people, and the part a buyer is paying for is somebody willing to put their name against that judgment in front of a credit committee. A report nobody will defend out loud is not worth what it costs to produce, however it was produced.

Does anyone have any good quality of earnings stories?

The one that stays with us is not a fraud. An owner told us the business ran without him and offered a two-week holiday as proof, and he believed it. His calendar showed 61 percent of his scheduled time in customer, pricing and vendor meetings, and eleven of fourteen recurring approvals routing through him. During the two weeks he was away, shipping and counter service ran fine, which is what he remembered. Two project quotes waited for him, a vendor rebate deadline was missed, and the top account called his mobile twice, which is what he did not. Owners under-report this one consistently and they are not being dishonest about it. A man who has answered the phone for twenty-eight years genuinely does not notice that he is the phone. The calendar notices.

Insights

Straight talk for owners and dealmakers.

Operator-grade thinking for deals of roughly $500K to $5M of EBITDA, and the owners behind them: what actually moves the price of a business, how a buyer reads your earnings, and how to be ready before you go to market. Written by the people doing the work. No pitch, and we add to it over time.

Start here

If you read three things.

Field guide

Bought, Not Sold

The owner’s guide to the five things a buyer scores before they pay, with an honest self-assessment. Read it in full on the site, or download the printed edition.

Article

Two owners. Same profit. Very different price.

Two owners sold the same year with profit within rounding distance of each other, and walked away with very different checks. The gap was never the earnings number. It was how provable, how durable and how transferable those earnings were, and all three are things an owner controls.

selected work

The clean-looking deal with a 24% problem.

How a buy-side Quality of Earnings kept a searcher from overpaying, without killing the deal.

Quality of Earnings

Ryan Anoskey, CPA · 14 September 2026 · 18 min read

What Level of Quality of Earnings Does a Deal Under $3 Million Need?

Forty-six tests at full scope, about twelve at $2 to $3 million. The ladder by deal band, with fees, the clock, and what each tier does not test.

Ryan Anoskey, CPA · 30 August 2026 · 11 min read

What a Quality of Earnings Report Costs

Published prices run from $3,900 to $25,000 across four different products. What sets your number, and when you should not buy one at all.

Jared Luegers, CFA · 14 August 2026 · 10 min read

What a Quality of Earnings Report Won’t Tell You

A quality of earnings report proves last year’s profit was real and that the add-backs hold up. It cannot prove the customers stay, that the business runs without the seller, or that the profit survives the day you take over. That second column is where deals break after close.

Ryan Anoskey, CPA · 10 August 2026 · 4 min read

Add-Backs, and the Earnings a Buyer Is Actually Paying For

Every dollar of adjusted EBITDA carries the deal multiple on its back, so a $100,000 add-back moves the price half a million at five times earnings. Adjustments that survive are truth corrections with a file behind them, and each one has to pass two gates: classify it, then prove it.

Ryan Anoskey, CPA · 12 September 2026 · 10 min read

A Seller’s Add-Back Schedule Only Ever Moves the Number Up

The three gates an add-back has to clear, a tested register showing the three that failed, and the earnings ladder from the filed tax return upward.

Ryan Anoskey, CPA · 14 July 2026 · 5 min read

What a Buyer’s Quality of Earnings Review Actually Checks

There are two numbers in every sale of a business: the earnings you report, and the earnings that survive a buyer’s review. A buyer tests four things: your real provable earnings, whether the revenue repeats, whether the bank statements match the books, and the working capital the business runs on.

Buying a Business & SBA

Ryan Anoskey, CPA · 12 September 2026 · 12 min read

The Loan Decides the Price More Than the Multiple Does

From 1 October a lender must use the quality of earnings figure in the coverage test. The arithmetic at every loan size and both amortizations.

Ryan Anoskey, CPA · 30 August 2026 · 10 min read

The QoE You Already Paid For May Not Count

Under SOP 50 10 8.1 the lender must have a quality of earnings report, a seller’s report never counts, and since 25 September yours can, once the lender’s vendor reviews it. What that means for a report you already paid for.

Ryan Anoskey, CPA · 30 August 2026 · 14 min read

What the SOP Leaves Out, and SBA Said Anyway

What Appendix 15 of SOP 50 10 8.1 requires on a 7(a) acquisition, category by category, after SBA’s 25 September update, and the one point where SBA’s notice and the SOP text still differ.

Ryan Anoskey, CPA · 30 August 2026 · 8 min read

What a Lender Needs to See Before They Will Fund

Underwriting rarely rejects a weak business. It stalls on numbers that cannot be tied to a source document. What an SBA credit file actually requires, using SBA’s own arithmetic.

Jared Luegers, CFA · 12 September 2026 · 11 min read

SBA Carries Two Different Concentration Thresholds in the Same Rulebook

No threshold when SBA tests the earnings, a 20 percent default when it lends against the invoice. The reference-call protocol, published in full.

Ryan Anoskey, CPA · 12 September 2026 · 13 min read

A Working Capital Peg Can Be Calculated Correctly and Still Be Wrong

Computed against tested, the four peg methods, how a working capital true-up works on a 7(a) deal, debt-like items and the tax that survives an asset purchase.

Operating & Post-Close

Jared Luegers, CFA · 12 September 2026 · 11 min read

Three of the Five Seats Are Owner-Held, and None Has a Successor

A business can be profitable without being transferable. The five critical seats, relationship ownership tested against four sources, and the taper.

Jared Luegers, CFA · 30 August 2026 · 8 min read

What an Operating Partner Actually Does After the Close

You do not get to change nothing. Some changes after a close are forced on you and some you are choosing, and sorting them is what makes a 100-day plan work.

Preparing to Sell

Ryan Anoskey, CPA · 22 September 2026 · 10 min read

The Retrade: How the Price Moves After the LOI, and What Stops It

Three ordinary findings take $1,530K off a $15,000K letter. The five findings that move the price after the LOI, and what an owner one to two years out can do about them now.

Jared Luegers, CFA · 3 July 2026 · 9 min read

How to Increase the Value of Your Business Before You Sell

You raise what a business is worth by making it less dependent on you and more certain for a buyer. Five levers do most of that work: clean numbers, a business that runs without you, a real second-in-command, a clear growth story, and books you could open tomorrow.

Jared Luegers, CFA · 26 June 2026 · 5 min read

Two owners. Same profit. Very different price.

Strategic Finance

Jared Luegers, CFA · 18 September 2026 · 11 min read

You were told you need a CFO. You may need a controller instead.

Many of the owners who ask us for a CFO need a controller first. The four questions that sort which seat is missing, why revenue is the wrong trigger, and when the gap is not finance at all.

Jared Luegers, CFA · 8 April 2025 · 11 min read

Inorganic Growth 101: Laying the Deal Groundwork

Before an RIA buys anything, it needs a corporate development function: a clear strategy, capital lined up, a repeatable way to source deals, real diligence, and a plan for integration. Most failed acquisitions trace back to skipping one of those, not to paying the wrong price.

Jared Luegers, CFA · 25 March 2025 · 11 min read

RIA Enterprise Valuation: What Drives It

Valuation in the RIA space comes down to what buyers will pay and why. Organic growth, margin discipline, client age, niche expertise and team depth move the number more than headline AUM, and the multiple shifts sharply across the size spectrum, with mid-tier platforms drawing the strongest interest.

Jared Luegers, CFA · 17 March 2025 · 6 min read

The RIA CFO Role: From Cost Center to Value Driver

As an RIA scales from $200 million to $2 billion in AUM, finance has to stop being a back-office cost center. The modern CFO partners with the CEO on capital, pricing and growth decisions, using real-time data rather than closing the books and filing them.

Field Guides & Whitepapers

Institutional guides, free to read.

Downloadable, plain-spoken guides for owners and deal teams. Built to the standard of the ones the big firms hand their clients.

Field Guide

Bought, Not Sold

The owner’s guide to the five things a buyer scores before they pay, with an honest self-assessment. Read it in full on the site, or download the printed edition.

An Indiana limestone quarry with sawn blocks squared and stacked across the quarry floor, and derrick cranes and a cutting rig working the far wall.

Field Guide

Due Diligence for the Self-Funded Buyer

The five questions a self-funded buyer answers before signing an SBA 7(a) deal, in the order the money is spent. Read it in full on the site, or download the printed edition.

Field Guide

Getting to Yes on Capital

Why the answer is usually the package, not the business, and what a lender or investor opens first. The owner’s guide to being lender-ready.

Field Guide

What a Buyer Checks

Proof of cash, add-backs, revenue quality, and working capital: the buyer’s-eye read of your earnings, and how to get ahead of the retrade before you list.

More guides are on the way. Want one we have not published yet? Ask us.

Selected Work

What the work looks like.

Named, client-approved case studies go here as engagements close. Until then, an illustrative walk-through shows the format and the kind of read we deliver. We never manufacture proof.

Buy-side QoE

The clean-looking deal with a 24% problem.

How a buy-side Quality of Earnings kept a searcher from overpaying, without killing the deal.

A Quick Self-Check

Twelve questions a buyer will ask before you sell.

If you can answer these cleanly, you are closer to ready than most. If a few make you wince, that is your punch list, and better to find it now than at the closing table.

If you, or your key person, were gone for a month, what would break?

Can you tie every dollar of profit you claim to the bank account?

Which add-backs could you defend to a skeptical buyer, out loud?

What share of revenue rides on your single biggest customer?

How much of the revenue recurs, versus starts from zero each year?

Who makes the day-to-day decisions when you are not there?

Is the plan written down, or is it in your head?

Could you raise price 10% and keep nearly every customer?

Do the monthly numbers close cleanly, and on time?

What is the business actually worth, and what would you net after the deal?

Who are the two or three most likely buyers, and why?

What will you do the day after the check clears?

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