The Problem With One-Size-Fits-All Multiples

Some market commentators publish neat quarterly tables: if your clients are aged 50–60, the multiple is 2.5×. Younger clients, higher multiple. Over 60, lower.
Sounds scientific, but it isn’t. The reality is:

• Sample size is too small. No one has enough transactions to make those tables statistically reliable.

• It’s one factor. Businesses are complex; reducing value to a single client age band misses the other 18 or so drivers that really matter.

The result? Buyers cite the table when it suits them, and ignore it when it doesn’t. Hardly a foundation for fair negotiations.

Why the Market Approach Falls Short

Another common method is the “market approach”: “This business of similar size sold for X, so yours is worth the same.”

That approach works in real estate—where sales are plentiful, transparent, and comparable, and the knowledge is available to the entire market. When a house sells, everyone knows the essentials: the street address, number of bedrooms and bathrooms, whether it had a pool, a double garage, or was built of brick. The features are clear, the data is public, and comparisons are straightforward.

With businesses, none of that transparency exists. Instead of full knowledge, we get hearsay, assumptions, and guesswork—snapshots of part of the picture, but never the whole story. You might hear a price or multiple, but the underlying drivers—the “why” behind the number—remain hidden inside a black box.

So What Really Drives Value?

After 18 years of broking transactions, we stopped asking “what multiple?” and started asking “what factors?”

For financial planning businesses, the top-level value drivers include:

• Services offered

• Staff capability and retention

• Clients (age, portfolio size, concentration)

• Compliance record

• Financials (profitability and growth trajectory)

• Systems

• Location

• Owner reliance

Each breaks down into measurable factors. For example: revenue per client, client concentration risk, referral sources, or compliance track record.

And here’s the catch: not all improvements are equal. Spending two years upgrading your back-office systems might make you operationally happier—but buyers usually replace them anyway. It won’t shift your valuation needle.

Listening to Buyers, Not Hearsay

To find out what really moves the needle, we went to the buyers. We collected national data from over 350 active buyers across Australia and the UK, asking them to rank 19 factors in order of importance.

That data now powers the Practice Value Insights Tool.

Here’s how it works:

1. You self-assess your business across the value drivers.

2. We benchmark your answers against live buyer-weighted data.

3. The system calculates your score, your Improvement Zone, and your Overscore (areas where more effort won’t add more value).

The end result? A valuation, plus a factor-by-factor roadmap showing where to focus for the biggest dollar uplift.

Turning Data Into Strategy

The tool doesn’t just say “your business is worth X.” It shows:

• Your score compared to national averages and buyer benchmarks.

• Your Improvement Zone—where targeted changes can significantly lift value.

• Overscore zones—areas already maxed out, where more effort won’t improve your price.

• Value Optimiser—a table ranking which factors deliver the highest potential dollar gain if improved.

In other words: stop guessing. Know exactly where to put your time and investment if building value is your goal.

Why This Matters

Too many owners focus on the wrong things. They assume better systems or glossy offices equal higher multiples. The data says otherwise. Buyers care most about profitability, client demographics, retention risk, and compliance integrity.

Understanding these weightings means you can:

• Strengthen your negotiating position—because you’ll know what buyers actually value.

• Avoid wasted effort—by skipping improvements that won’t add a cent to your valuation.

• Close the Value Gap—unlocking the difference between your current worth and your maximum potential worth.

Final Thought

Your business’s true value isn’t set at a barbecue, in a quarterly table, or by what the neighbour’s accountant claims. It’s set by what informed buyers are willing to pay—based on dozens of factors, not just one.

The good news? With the right insights, you can control many of those factors. And when you do, you don’t just hope for a better multiple—you create it.

Ready to See Where You Stand?

If you’re curious about what buyers would pay for your financial planning business right now—and what specific changes could unlock the greatest uplift—the Practice Value Insights Tool is designed for you.

Benchmark your business against live dynamic UK buyer data
Discover your “Improvement Zone” and “Overscore” areas
See exactly which factors move the needle on value
Get your tailored report delivered instantly

Request your Practice Value Insights Report today and take control of your business’s future value.

Built with actuarial input and launched with solid endorsement at the 2025 FINRA EurAsia Actuarial Conference, where participants from over 20 countries across Europe, Asia, and Australia praised its approach—many noting that the live dynamic buyer data was unique and added a new dimension to valuation, making the insights more meaningful and actionable.