Enjoying this article?

One email, two high-value newsletters straight to your inbox. Each one delivers everything you need to be smarter than a private equity investor.

Main Street Minute

This 1 Thing Has NEVER Been More Valuable (For Biz Buyers)

January 8, 2025
7 min read
Biz Buyers,

Welcome to Main Street Minute — where we share some of the best ideas from inside our acquisitions community.

Whether you’re curious or serious about buying a business, you’re in the right place. Their words, not ours…

Trustpilot review

Now let’s get down to business...

This 1 Thing Has NEVER Been More Valuable For Biz Buyers

Right now, recurring revenue matters more than ever for business buyers and sellers in our community.

Here’s why you need to be thinking about it:

  • Predictability: Businesses with recurring revenue streams (subscriptions, service contracts) are more stable, particularly in economic downturns.

  • Valuation Premium: Businesses with a higher % of recurring revenue are commanding higher multiples.

  • Growth Leverage: With predictable income, you can more confidently access capital and reinvest in expansion, staff, or tech.

  • AI Buffer: In a changing landscape, recurring revenue can provide a buffer against market shifts and tech disruption in your industry.

If a business doesn’t have recurring revenue, ask yourself where you can build it in. It will help you sleep better at night. Business buyers pay for predictability, not volatility.

But here’s the thing… While recurring revenue is key, at the end of the day:

Revenue is vanity. Cash flow is sanity.

The more you learn about business, the more you'll be impressed by profitability, not necessarily revenue. But when you’re first getting started, it’s not so simple...

It’s critical not to get distracted by top line. Pull back the curtain. Focus on metrics that tell you about:

  • Profitability
  • Liquidity
  • Stability

A shiny facade means nothing if the foundation is cracked.

biz buyer story
From SaaS Exec to Main Street Builder

A new member of the Contrarian Community just shared their story. Here it is…

Their name is Chad, and years ago, Chad watched his father-in-law close down a CPA firm with no buyer.

“I was too dumb to put two and two together,” Chad admits. But the memory stuck. Now, after 15+ years of P&L leadership in SaaS — Chad’s ready to focus on Main Street.

“I love to work. I’m not built to live on a beach.” But now Chad wants to control what he actually works on, take his personal empire to the next level, and give time back to his family.

“I also want my kids to see the opportunities here as I change from Wall Street back to Main Street.”

Currently, Chad’s in due diligence on a real estate-driven business while exploring opportunities in home services and medical aesthetics.

This is what the Contrarian Community is for — helping smart, driven professionals like Chad navigate Main Street acquisitions, turning ambition into ownership.

Team Contrarian

The information contained here is educational, may not be typical, and does not guarantee returns. Background, education, effort, and application will affect your experience and the profitability of any business. Individual results may vary.

Share
contrarianthinking.co/newsletter-articles/this-1-thing-has-never-been-more-valuable-for-biz-buyers