- CoreValue Advisor Software
- Quist Insights
- Value Opportunity Profile
- How to Start the Value Conversation with Your Clients
- Best Books and Methodologies for Value Growth
- Automated Tools for Assessing Business Value
- Automated Tools to Support Corporate Value Growth
About This Analysis
Our advisors use the platforms discussed here for determining a company’s strengths and weaknesses and for guiding future planning. Please note that the business assessments resulting from these services are not appropriate for legal, tax or transactional purposes in place of a certified valuation. We are also not including tools used by valuation professionals to create certified valuations, which run upwards of $10,000.
The information in this article is based on public data provided by the profiled companies on their websites and the XPX Advisors’ experiences.
Data source: 17 million businesses in more than 30 key areas
Inputs: 143 data points
Output: Three types of indicative valuation: Market Approach, Income Approach and Rules-of-Thumb approach
Advisor Support: For private advisors, BizEquity has resources available through a monthly subscription in their Advisor Office, which focuses on prospecting new clients and offers additional reports for existing clients, including an “Insurance Value Report” (add-on). They also have Accountant Office and Banker Office.
Pricing: For the basic report, their pricing starts at $299 for a yearly personal subscription. The subscription cost for the add-on services is not stated.
Of note: BizEquity says they are the “world’s only patented cloud-based valuation software.” They have close to two million users in the U.S.
Partnership: BizEquity is associated with BEI Exit Planning Solutions , which we talk about here.
XPX Member Experience (Eric T): I’m in a mergers and acquisitions firm. For folks in the insurance industry, they’ve got modules very specific to that. I think insurance companies are their number one client base. What it (BizEquity) produces is a little bit different than if you just started applying some multiples that you received from a database like The Business Reference Guide or Pratt’s Stats. They do have a reasonably decent report. It’s got its flaws for sure. At least it’s a baseline that you could build a report that you can actually present to a client in a more professional manner, with a little bit more credibility than we could otherwise.
They have a bunch of other things that people may find of interest. They’ve got what they call a success center, which is a library of resources that help you learn and sell business valuation to business owners. It’s relatively extensive, hundreds of documents in there, I believe, last time I looked.
It also has a prospecting tool where you could do some research. It’s okay when you marry it up with another data source if you’re buying one of the D&B products or something like that. It often will provide you some additional data points for when you’re prospecting business owners as well. I might have missed something, but that’s how we use it.
Data Source: Patented algorithms researched at MIT
Inputs: 18 value drivers, 78 sub-drivers
Output: Indicative value plus quality and risk ratings in 47 categories
Advisor Support: Their three products provide reports and planning using varied levels of detail. Additional options provide tools for managing and marketing consulting practices.
Pricing: There are three pricing tiers: Analyst, Growth Consultant and Consulting Practice Group, starting at $299/month plus onboarding fees. Additional costs and access to Analysis and Growth Plan varies by tier.
Of note: CoreValue asserts that their enterprise values come within 10-15% of a traditional financial valuation.
Partnership: CoreValue consulting methodologies are offered through the National Association of Certified Valuators and Analysts (NACVA).
XPX Member Experience (Andrew W): This is what attracted me; the idea of a consulting system whereby we could identify the value drivers of a business and look at the gaps in the value drivers and build improvement plans around it. CoreValue does exactly that across 18 value drivers, nine of them which are operational, nine market drivers.
I use it in two ways, generally. I would use it as a precursor to engaging with a client who is not necessarily thinking of transitioning or exiting, but is looking to grow the company. That could be a standalone growth engagement, whether it be growth or building equity value in the company. What it then allows me to do is build up the “know and trust” aspect of a consultancy, and then begin as we build the relationship, to then ask that question: what is it that you want to do long-term with the business? Which opens up the transition planning and exit planning aspect of an engagement.
It comes with comprehensive training; it comes with other content, marketing content and collateral that you can use to build into your business too. It helps you there. Always as a friendly face and voice at the end of an email or telephone if you run into any difficulties.
Data Source: 5,000+ valuations by the valuation firm that created the product
Inputs: Summary financial information plus 60 questions in six value driver categories: Strategic Value, Organizational Value, Employee Value, Customer Value, Financial Value, Environment, Social & Governance Value (ESG).
Output: An indicative value, value gap and actions to close the gap
Advisor Support: Partnerships include different levels of landing pages and a dashboard for easy tracking.
Pricing: There are two pricing options for their business assessment service: Core plan which costs $799 yearly and gives you access to Management Insights, Expert Insights and customer care; and Advanced Plus plan which is $1399 yearly and grants you all of the previously listed services plus Expert Insights.
Quist Representative (Ken B): Quist Insights is a relatively new entrant into the market. Quist Insights is owned by Quist Valuation, a 35-year-old, full valuation firm located in Boulder. We’ve been doing valuations for all those years and it’s been thousands and thousands. Really, the driver for the software was the fact that our current owner, Shina Culberson got recurring questions from owners that she was dealing with on various valuation projects.
The software is based on the fact that not only do we look at quantitative and the numbers, but we’re also looking at five additional qualitative areas. It’s got unlimited use, so they can take the assessment as many times as they want to. It’s comprised of about 65 questions that a client goes through; it takes about an hour to answer the questions.
What we do is generate a current business value. Then we’ll also assess across the six areas and determine strengths and places where there are areas for improvement. We generate an actionable recommendation report of about 30 pages. What that’s really driving toward is what the potential value of the business could be.
Data source: Not specified
Inputs: Eight primary categories: Planning, Sales, People, Finance, Leadership, Marketing, Operations and Legal. There are also 47 subcategories of business operations to round out the evaluation.
Output: An “opportunity profile” that includes both intrinsic and equity value of the company, as well as risks and strategies for maximizing value.
Advisor Support: They have specific offerings for accounting, valuation, exit planning, M&A and turnaround management.
Of note: The company states the product is suitable for businesses with revenues from $5M – $300M. They assert that their strategic roadmap and resources have been shown to increase company value by 80-100% over a three to five year period.
Partnerships: VOP principles are utilized in the CEPA certification program from EPI, and often in the CBEC program from PES, both of which we discuss here.
We did not have any members present during the webinar with personal experience with VOP.
Why Advisors Use Automated Assessment Tools
Ken B: I think one of the values of the software is that it provides you a mechanism to start the conversation with clients. To walk in and ask the question of, “Are you ready to exit your business?” The general answer is no.
Andrew W: People run away from the words “exit” and “transition.” I try not to use them, to be honest. This opens up a range of clients for me who are working already with professional advisers, accountancy, financial advisers who happen to say to that adviser, “I’m a bit stuck here. I’m looking to grow the business. Can you help?” I use it as a software engagement tool, and then, later on, we can transition into exit planning. I think it’s a good conversation starter, and it’s an attractive tool to show the business owner.
Eric T: It’s also a way in which we can at least start thinking about what the market may tell us. I use the word may in bold and underlined a couple of times because, ultimately, the market’s going to dictate the value of a company when it does transfer, which is obviously what I’m focusing on. It gives us some sort of baseline in our own minds for what we should be countering with, what’s acceptable, and what’s not.
We hope this article was helpful to you. It’s part of a series of posts about methodologies and tools advisors use to support their private company clients in value growth engagements. Here are the other articles in the series:
For more information and resources, check out our Advisor Resources section. The video for this webinar is below.