biophase
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Lol makes sense. I had a buddy who said he was a millionaire because he did 100k in consulting a year and claimed a 10x multiplier. Obviously overstated for him - but always wondered for myself what my business asset was worth considering our profits.
I'd use 2.5X to be conservative. But if you sell, you give up 10% to broker commissions and 20% to taxes, so if you sold a biz for $1m, you'd get $700k. Not even close to being a millionaire.
But it really doesn't matter does it. Your buddy making $100k is far far away from being a millionaire, which is why he cares about the number.
If you are making $250k a year, you will become a millionaire in 4-5 years easily assuming your business grows a little each year and you don't spend all of your money. At that point your goals are to be worth $5M, not $1M so you don't even really calculate it.
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