# Answers Hub: straight answers for owners · Horizon

Canonical: https://withhorizon.co/answers

Answers Hub

# Straight answers for owners

Pick a topic to see the questions owners ask most, with a short answer first and the detail after.

## [Valuation](/answers/valuation)

What your business is worth, and why.

-   ### 
    
    Most private businesses are valued as adjusted EBITDA times a multiple. The profit a buyer believes will continue is multiplied by a number that reflects risk and growth.
    
    [Full answer →](/answers/valuation/how-is-my-business-valued)
    
-   ### 
    
    It depends on size, industry, growth and risk. Smaller owner-led service firms often sit lower; larger, recurring, owner-independent firms sit higher.
    
    [Full answer →](/answers/valuation/what-multiple)
    
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    Add-backs are costs added back to profit because a new owner would not have them. Buyers accept the ones you can document and reject the rest.
    
    [Full answer →](/answers/valuation/what-are-add-backs)
    

[See all 3 in one place →](/answers/valuation)

## [Owner dependence](/answers/owner-dependence)

Getting yourself out of the middle.

-   ### 
    
    Owner dependence is how much the business relies on you for sales, relationships, decisions or know-how. Buyers see it as risk, and risk lowers the price.
    
    [Full answer →](/answers/owner-dependence/what-is-owner-dependence)
    
-   ### 
    
    Move one job at a time from you to the business: write it down, hand it to a person, and set a scorecard so you can see it working without being in it.
    
    [Full answer →](/answers/owner-dependence/how-to-step-back)
    
-   ### 
    
    For most owner-led companies it takes one to three years of steady work. The first real handoffs can happen within 90 days.
    
    [Full answer →](/answers/owner-dependence/how-long-owner-optional)
    

[See all 3 in one place →](/answers/owner-dependence)

## [Growing value](/answers/growing-value)

Raising what the company is worth.

-   ### 
    
    Grow the profit a buyer will pay for, and raise the multiple they pay on it. The biggest levers are pricing, recurring revenue, a strong team and less dependence on you.
    
    [Full answer →](/answers/growing-value/increase-company-value)
    
-   ### 
    
    Not on its own. Revenue growth helps if it brings lasting profit and lower risk. Growth that depends on you or a few clients can leave the multiple flat.
    
    [Full answer →](/answers/growing-value/does-revenue-raise-multiple)
    
-   ### 
    
    It can grow profit and your multiple at the same time, but only if you can fold each company onto one platform. Buying without a platform adds work and risk.
    
    [Full answer →](/answers/growing-value/grow-by-acquisition)
    

[See all 3 in one place →](/answers/growing-value)

## [Preparing to sell](/answers/preparing-to-sell)

Getting ready, on your timeline.

-   ### 
    
    Ideally two to three years before you want to sell. Most value is lost to issues that were fixable a few years earlier.
    
    [Full answer →](/answers/preparing-to-sell/when-to-prepare)
    
-   ### 
    
    After you accept an offer, the buyer reviews your financials, contracts, team, tax and legal matters in detail. Surprises found here are the most common reason prices drop.
    
    [Full answer →](/answers/preparing-to-sell/what-is-due-diligence)
    
-   ### 
    
    Expect corporate records, 3 years of financials and tax returns, key contracts, employee agreements, IP ownership and insurance. The goal is to open a data room within 48 hours.
    
    [Full answer →](/answers/preparing-to-sell/what-documents)
    

[See all 3 in one place →](/answers/preparing-to-sell)

## [Deals and offers](/answers/deals)

Offers, terms and how deals get done.

-   ### 
    
    A letter of intent sets out the proposed price, structure and key terms before diligence. It is mostly non-binding, but once signed you usually stop talking to other buyers.
    
    [Full answer →](/answers/deals/what-is-an-loi)
    
-   ### 
    
    Cash at closing is certain. An earnout pays later only if targets are met, often after you no longer control the business. More cash up front usually means less risk for you.
    
    [Full answer →](/answers/deals/earnout-vs-cash)
    
-   ### 
    
    Don’t say yes or no yet. Find out what your business is worth first, so you can judge the offer against your real number, not the buyer’s.
    
    [Full answer →](/answers/deals/unsolicited-offer)
    

[See all 3 in one place →](/answers/deals)

## [Tax and wealth](/answers/tax-wealth)

What you keep, in Canada.

-   ### 
    
    In a share sale the buyer buys your shares and the whole company. In an asset sale they buy chosen assets and leave the company with you. The tax result for you can be very different.
    
    [Full answer →](/answers/tax-wealth/share-vs-asset-sale)
    
-   ### 
    
    It is a Canadian tax rule that can shelter part of the gain when you sell shares of a qualifying small business. Your company must meet the tests at the time of sale, and planning takes years.
    
    [Full answer →](/answers/tax-wealth/what-is-lcge)
    
-   ### 
    
    Less than the headline price. Start with the price, subtract debt, adjust for working capital, then take off fees and tax. Structure decides much of the difference.
    
    [Full answer →](/answers/tax-wealth/what-do-i-take-home)
    

[See all 3 in one place →](/answers/tax-wealth)

New answers, every Thursday.

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