Business Risk & Value Framework
Six dimensions that shape business quality, transaction readiness and the multiple a buyer will pay.
Why a framework
Buyers, lenders and investors assess the same handful of things, in roughly the same order. Setting them out explicitly gives an owner a checklist rather than a surprise, and gives our own analysis a consistent shape from one engagement to the next.
The output is a readiness view and a set of value drivers and constraints. It informs professional judgement about an indicative range; it does not mechanically set a multiple.
The six dimensions
Financial Quality
Revenue trend, EBITDA, cash conversion, debt, working capital, quality of earnings
Commercial Quality
Recurring revenue, customer concentration, contracts, pricing power, pipeline
Operational Resilience
Processes, systems, supplier dependency, capacity, scalability
Management & People
Key-person risk, second-line management, retention, capability
Compliance & Governance
Licences, policies, corporate records, disputes, governance
Transaction Readiness
Data room, accounts, contracts, tax records, ownership clarity
Indicative weightings. The output is expressed as a risk and readiness view that informs professional judgement about an indicative valuation range. It does not mechanically set a multiple.
Using the output
Before a sale
- Identify the constraints that can be fixed in 6–12 months
- Evidence the strengths that support the top of the range
- Prepare answers to the questions diligence will raise
Before an acquisition
- Test the seller's story against the same dimensions
- Price the risks that cannot be resolved pre-completion
- Shape structure, retention and earn-out around them
Without a transaction
- Set a value-creation agenda for the next two years
- Reduce dependency on any single customer or person
- Improve the quality of reporting and records
A note on language
Crystal Zest will describe this framework as proprietary only once the methodology, scoring definitions, evidence standards and governance have been fully documented. Until then it is presented as our structured assessment approach.
Start a confidential conversation
Whether you are preparing to sell, looking to acquire, raising capital or trying to lift the value of a business you already own, the first step is a short, confidential discussion about the situation.