My Profitable Company Is Worthless to Investors — Here’s Why That Works in My Favor

Over the past few months, I’ve received a surprising number of emails and even phone calls from private equity firms asking if I’d consider selling my business.

“Gene,” they all say, “we’ve followed your growth in the technology space and believe we can help you unlock value while preserving your legacy and team. Would you be open to a 20-minute call to discuss mutual opportunities?”

It’s flattering, sure. And it makes sense. According to Harvard’s Corporate Governance site, private equity exits jumped from $754 billion in 2023 to $902 billion in 2024 — about a 20% increase. Other reports show deal value rising by 50% in the first half of 2024 alone, with strategic acquisitions leading the way.

Private equity is everywhere — scooping up contractors, manufacturers, distributors and yes, even tech companies like mine.

Why? Because many business owners are aging out. The average small business owner in the U.S. is over 55, according to the Small Business Administration — and that was back in 2020. So a wave of exits is underway, and investors are eager to buy businesses with strong financials, recurring revenue and growth potential.

But my business? I don’t think I’m sellable. Not because I wouldn’t entertain an offer — but because once a buyer looks under the hood, they’ll realize the uncomfortable truth: My company has no real value.

Related: Want to Maximize the Sale Price of Your Business? Start with These 5 Value Drivers

The balance sheet no one wants

Let’s start with the basics. My business has no hard assets. No buildings, no equipment, no physical property. Just a bit of cash and accounts receivable.

Sure, we also have very few liabilities. In fact, most of our “payables” are actually prepaid client deposits — blocks of time that customers purchase in advance. It’s a great way to boost cash flow and reduce risk, but it creates a liability a buyer would need to honor. Not exactly attractive.

No contracts, no guarantees

We don’t lock clients into long-term contracts. We’ve never sold maintenance agreements or recurring support plans. Our clients use us when they need us — and leave when they don’t.

There’s no proprietary process or secret sauce. What we do isn’t complicated. In fact, anyone could learn it online. Our clients hire us not because we’re unique, but because they don’t have the bandwidth to do it themselves.

So if a private equity firm were to evaluate my company, they’d quickly realize there’s no predictable revenue stream to base a valuation on. No recurring income. No clear multiple to apply. We go project to project, client to client.

That might work for me. But it doesn’t work for them.

A team that disappears when I do

I do have employees. But most of the work is handled by independent contractors. That comes with its own risk — from worker classification issues to a lack of long-term commitment.

Our setup has always been virtual. We’ve been remote since 2005. No office. No shared culture. No in-person meetings. Everyone works independently, and I check in as needed. It works for us — but it doesn’t scream “scalable organization.”

The reality? This business doesn’t run without me. I do the selling. I do the marketing. I oversee projects, handle accounting, manage admin and lead the day-to-day. If I were hit by a bus tomorrow, this business would fold within 30 days — with contractors and staff likely splintering off to do their own thing.

No IP, no exclusivity, no moat

We implement CRM platforms. It’s a crowded, competitive space. The very vendors we represent are often our biggest competitors. There’s no barrier to entry. Competitors appear regularly — usually cheaper, often younger and sometimes better.

We don’t have any intellectual property, documented systems or defined processes. Every project is different, and it rarely makes sense to create templates or workflows that won’t apply next time.

So there’s nothing here to “buy.” No assets. No exclusivity. No edge.

So, what do I have?

I have a business that works for me.

For more than 25 years, it’s paid the bills, put my kids through college and built a retirement plan for my wife and me. It’s also supported dozens of employees and contractors along the way. That’s something I’m proud of.

My model has always been simple: do the work, bill for it, generate cash, save what you can. Rinse and repeat. And for me, it’s worked beautifully.

But let’s be honest: this model doesn’t build transferable value. There’s no goodwill. No buyer-ready systems. No brand equity. No enterprise value. Just a highly functional, one-person-driven operation that disappears without me.

Related: Starting a New Business? Here’s How to Leverage Transferable Skills From Your Prior Careers and Drive Success

If your business looks like mine

Don’t be discouraged. But do be realistic.

You may be generating cash — and that’s great. You may be living well — even better. But unless you’ve intentionally built for scale, structure and succession, your business may not be worth much to anyone else.

And that’s okay — as long as that’s the plan.

For me, it is.