Before scheduling any interviews with business brokers, the first number you should check is their deal count. This simple figure can provide a clear indication of a broker’s activity level, experience, and ability to navigate the sale process successfully. Business brokers with a high deal count typically have significant experience navigating transactions, though additional factors such as success rate and client satisfaction should also be considered to assess their market expertise.
For small business owners or those running lower middle market companies, knowing how many businesses a broker has sold recently is crucial to securing the maximum value for your business. High deal activity shows that the broker is actively working and signals their ability to handle the complexities of business sales, from negotiations to due diligence, ensuring a smoother transaction.
What Is a Business Broker’s Deal Count?
A business broker’s deal count refers to the number of transactions they’ve successfully closed over a certain period. It reflects their activity level and ability to get businesses sold. A broker’s deal count can reveal their experience, showing how often they work with buyers and sellers in your industry. A higher deal count may indicate more familiarity with the sale process, but the complexity and variety of the transactions also matter when evaluating experience.
The last 12 months are crucial when looking at the deal count. This time frame provides the most accurate picture of a broker’s current activity and effectiveness in today’s market. It shows how well they are adapting to changes in buyer demand, market trends, and pricing conditions. You can find deal count data through public profiles, like a broker’s website or LinkedIn page, where they often list recent transactions. Some brokers also share deal count details in directories or on business-for-sale platforms.
Why Deal Count Indicates Broker Momentum
A high deal count can indicate that a broker is active, but it’s essential to check the recency of those deals to assess their current market involvement. Brokers who close deals regularly may be more familiar with market trends and pricing strategies, but it’s important to verify their knowledge of current conditions. It also shows that they regularly interact with potential buyers, which can speed up the sale process.
On the other hand, low or outdated deal counts may signal a lack of engagement or momentum. If a broker’s numbers are from several years ago or closed fewer deals recently, it could mean that they are less involved in the business brokerage industry. This can affect their ability to connect your business with the right buyers, especially in fast-changing markets.
How Deal Count Affects Your Sale Outcome
Your business sale outcome can significantly depend on your broker’s deal count. A broker with a high deal count may have experience in handling business sales, but securing the best price depends on factors like negotiation skills and buyer connections. They’ll also be able to guide you through the sale process more effectively, increasing the likelihood of a successful transaction.
More deals mean sharper market insight
Brokers who close many deals each year develop a deep understanding of market trends. They know how businesses in your industry are valued, what buyers are looking for, and how to position your business for the highest sale price. This knowledge helps brokers create better marketing strategies, set realistic expectations, and avoid pitfalls that could otherwise slow down or derail the sale.
Experienced brokers navigate obstacles better
Experience may equip a broker to handle obstacles more effectively, but how they manage challenges depends on their approach and past problem-solving abilities. From tough negotiations to unforeseen issues with due diligence, experienced brokers can resolve problems quickly and effectively. Their ability to navigate these challenges ensures your sale goes as smoothly as possible, reducing the chances of a drawn-out, frustrating process.
Recent deals suggest strong buyer connections
A high deal count over the past year indicates that a broker has a strong network of potential buyers. A broker may have relationships with buyers, including private equity firms, depending on their network and experience, but it’s important to ask about the specific buyers they connect with. This gives your business a competitive advantage because brokers with recent deal activity can introduce your company to the right buyers ready to make an offer.
How to Verify a Broker’s Deal Count
Verifying a broker’s deal count is essential to ensure they are active in the market and can successfully sell your business. Here are some reliable ways to check their deal count and confirm their experience.
Use LinkedIn, websites, and business-for-sale listings
LinkedIn profiles, brokers’ personal websites, and business-for-sale platforms are excellent sources to check a broker’s deal count. Many brokers proudly display recent transactions on their profiles or business pages.
These platforms often provide deal-specific details, such as transaction dates and types of businesses sold. Reviewing these listings can give you a solid understanding of the broker’s recent activity, industry reach, and expertise in selling businesses like yours.
Ask for proof or a recent deal sheet
To verify the broker’s deal count, ask them directly for proof, such as a recent deal sheet or a list of closed transactions. A reputable broker will have no problem sharing this information.
A detailed deal sheet should include specifics like the business names, deal sizes, sectors, and dates. This transparency will help you assess the broker’s ability to close deals in your business’s industry and price range, providing confidence in their capabilities.
Spotting inflated or vague deal claims
It’s essential to be cautious when a broker makes vague or inflated claims about their deal count. It could be a red flag if they don’t provide clear details, such as transaction dates or client names. Watch for brokers who mention “several deals” but don’t offer specifics or those who list only large, one-time deals as evidence of success. These claims may be an attempt to mask a lack of recent activity or expertise in your sector.
When a Low Deal Count Isn’t a Dealbreaker
A low deal count doesn’t always mean a broker lacks the skills or ability to sell your business. Some brokers have unique strengths that can still lead to a successful sale.
New brokers with niche expertise
New brokers may have fewer deals under their belt, but they could bring valuable niche expertise to the table. For example, brokers specializing in industries like e-commerce or private equity may not have as many deals but can offer deep knowledge of specific markets. Their focus on a particular sector often means they have up-to-date insights and can connect your business with the right buyers, even if their deal count is lower.
Solo advisors who focus on fewer, larger deals
Solo advisors or independent brokers may focus on fewer, larger transactions, such as middle market or asset sales. While their deal count may be lower than brokers in high-volume sectors, they often handle deals with higher sale prices and greater complexity. If you’re selling a business with a significant sale price or unique assets, these brokers can be valuable partners due to their experience negotiating larger, more intricate deals.
What else to evaluate beyond deal volume
In addition to deal count, consider other factors when evaluating a broker’s potential. Look at their industry knowledge, track record with clients, responsiveness, and ability to communicate clearly. A broker’s fee structure and understanding of market trends are also important. A broker’s reputation and client satisfaction are just as crucial as their deal count when securing the best outcome for your sale.
Let Deal Count Lead Your Evaluation
A broker’s deal count can provide insight into their activity level, but it should be considered alongside other factors like industry expertise and reputation when evaluating their market relevance. Use deal count as your first filter to identify brokers who are active and successfully selling businesses today.
Whether they’re closing deals in your industry or navigating the complexities of business sales, a high deal count shows that a broker has the experience and buyer network to ensure your business gets the maximum value. However, evaluating other factors, like industry expertise and reputation, is vital to choose the right broker for your needs.
Frequently Asked Questions
How many deals should a good business broker close per year?
A good business broker should close at least 5-10 deals per year to show consistent activity and experience.
Where can I find a broker’s past deal history?
You can find a broker’s past deal history on their LinkedIn profile, website, or business-for-sale listings.
What does a high deal count say about a broker’s skills?
A high deal count indicates that a broker is experienced, active, and has a strong network of potential buyers.
Can a new broker still be a good choice if they have few deals?
Yes, a new broker with niche expertise can still be a great choice if they specialize in your industry or market.
Should I ask for proof of a broker’s claimed deal count?
Yes, always ask for proof, such as a deal sheet, to verify a broker’s claimed deal count and ensure their credibility.
References
- International Business Brokers Association. (2005). Business-Brokerage-Standards. https://www.ibba.org/wp-content/uploads/2020/02/Business-Brokerage-Standards.pdf
- International Business Broker Association. (n.d.). Find a Business Broker. https://www.ibba.org/find-a-business-broker/
- Investopedia. (2023). How to Spot Market Trends. https://www.investopedia.com/articles/technical/03/060303.asp
- Investopedia. (2024). What Is a Sale? How It Works, Different Types and Ways to Pay. https://www.investopedia.com/terms/s/sale.asp
- LinkedIn. (2023). How to Build and Showcase Your Niche Expertise. https://www.linkedin.com/advice/0/what-some-effective-strategies-building-c8ltf
- Shopify. (2024). 10 Best Marketplaces for Buying an Online Business (2024). https://www.shopify.com/ph/blog/buy-online-business
