Free tool

Pounce or pass? Small business deal calculator

Six questions for buying a small business. Plug in the seller’s numbers and get a straight answer.

Works for online and local businesses alike: content sites, newsletters, and SaaS, or a laundromat, pressure washing company, or service business.

Nothing you type is saved or sent anywhere.

1. Why is the seller selling?

Personal: health, retirement, a new job, moving on to another projectUnclear: “just want to move on,” with no detailSomething’s breaking: falling revenue, a Google update or a lease running out, a new competitor online or down the street

2. What does it earn in a bad month?

Worst month’s profit, last 12 months ($)

Average month’s profit, last 12 months ($)

3. What does a quarter with zero sales cost?

Monthly fixed costs: hosting and software, or rent, utilities and insurance ($)

Already taken out of the profit above. Times three, it's the cash to survive a quarter with zero sales, added to the price.

4. What would it cost to pay someone to run it?

Hours per week to run it

Hourly rate to hire it out ($)

5. What are you paying?

Asking price ($)

Max years to pay it back

Price ÷ a year of cash, after paying someone to run it. At 2, a business clearing $10,000 a year is worth up to $20,000 to you.

Your price cap: $15,000

6. Is the upside in a lane you know?

Yes: the kind of business I’ve run or worked in, whether that’s a newsletter or a lawn care companySort of: close to what I know, but some new skills neededNo: new to me, like going from websites to e-commerce, or from lawn care to a restaurant

Dig deeper

Average month’s profit	$800
Paying someone to run it, per month	-$433
Average month’s cash after that	$367
A year of that	$4,400
Worst month’s cash after paying someone	$67
Price plus a 90-day cushion	$12,180
Years to pay it back	2.8 years

Why

Dig deeper: A 43% drop in revenue from a typical month wipes out the cash. Find out how steady sales are.
Dig deeper: It takes 2.8 years to pay back, a bit over your 2-year line. Negotiate, or verify the numbers.
The reason for selling is personal, not a broken business.
A bad month still makes $500.
The price plus a 90-day cushion ($12,180) fits under your $15,000 cap.
The upside is in a lane you already know.

This checks the basics: why the seller is leaving, what it earns in a bad month, and what it costs to run for 90 days. Local businesses also need checks this doesn’t cover, like the lease, equipment condition, licenses and permits, and key staff.

A filter, not financial advice. Verify the seller’s revenue, costs and customer numbers yourself.

Most deals die on question 4.

The hours it takes to run are the biggest haircut. Automate them, and the same deal can flip to pounce.

Tell us what’s stuck →