I just had a conversation with a business owner planning his exit.
It’s a $20M company that wants to 5x over the next five years. He wants to sell after that.
But these goals are enemies.
Here’s why revenue goals destroy exit value:
Point #1: Revenue doesn’t determine what someone pays for your business - EBITDA does
Growing 5x in revenue means nothing if your margins stay thin. Growing and getting max exit value are 2 different things.
Point #2: Revenue goals force you to spread resources everywhere (the opposite of what buyers want)
Starting new products while his existing ones struggle.
Investing in declining areas instead of doubling down on the one thing that’s actually working.
Revenue growth that demands “more of everything” will spread you too thin.
Point #3: The revenue chase makes you irreplaceable (killing your sellability)
He’s working 80-hour weeks. He’s still handling operations. The business can’t run without him. No one will pay good money for a business that dies when they buy it.
The fix is simple but hard:
He needs to pick. Hit the Revenue goal or Exit (or sequence them with time between)
An alternative, make your current top line your bottom line. You might only hit 2.5x instead of 5x - but I’d bet your EBITDA (and exit check) will be way higher.
Revenue is a vanity metric. Profit is what gets you paid.