It doesn’t just depend on the business being good — it depends on whether there are active buyers willing to pay for it right now.
At Bondo Advisors, we receive a constant flow of opportunities. People introducing us to business owners considering selling. VCs or investors looking to exit a startup they backed a few years ago. And entrepreneurs who contact us directly to help them find a buyer for their company.
We are a boutique firm. We can handle at most ten processes per year, and around 90% of our revenues are success-based — they depend on closing the deal.
Choosing which clients to assist in a sale process is probably the most important decision in our business. An M&A process takes months of work, and even when a good buyer is found, some deals fall through for reasons beyond our control.
The client changes their mind. The valuation or deal structure doesn’t fit. Retention of the management team becomes complicated. Due diligence stalls. The buyer gets acquired and changes its plans. A macro slowdown hits. A pandemic. The company has a weak year or loses a key client.
Some mandates will inevitably not close — that’s part of the risk we take. That’s why we are obsessed with selecting companies we are 100% convinced can be sold (and can be sold now), knowing that even with the right choice, some transactions will not yield a success fee.
The short answer is simple.
If the company has over €25 million in revenues, €5 million in EBITDA, is growing, and is not overly dependent on a single client, partner, or supplier, we will find a buyer. At that level, sector, geography (as long as it’s stable), or specific business nuances matter much less.
Above that size, the market opens up. International players come in, lower mid-market private equity funds, family offices with appetite, and even club deal vehicles led by former fund executives.
Below that threshold, the rules change.
With less than €10 million in revenues and €1 million in EBITDA, there are few financial buyers and not many strategic ones either.
Between €10–25 million in revenues and €1–5 million in EBITDA, the situation improves — more industrials are looking, and some financial investors such as search funds or certain family offices are active.
Above €25 million and €5 million, the universe expands significantly.
To put this in perspective: in Spain, only about 0.1% of companies exceed €50 million in revenues, according to data from the INE and the Startups Institute. So, most companies we talk to — and most of those we end up selling — fall within the lower range, which is natural.
People often assume that our decision on whether a company is “sellable” and whether we want to represent it depends on internal factors — whether it has a good product or technology, whether it’s growing, whether management is solid, or whether margins are attractive.
But in reality, our decision has much less to do with whether the company is “good,” and much more to do with whether there’s a universe of active buyers interested in that type of company right now.
We ask ourselves very specific questions:
Because there are many very good companies that simply aren’t sellable today. Some haven’t yet reached the critical mass that makes them interesting to funds or family offices. Others operate in sectors where it’s still too early for consolidation. And others belong to industries where the consolidation wave already happened, leaving little room for new acquisitions.
And this is not unique to Bondo Advisors.
Any experienced, results-driven advisor will conduct exactly the same analysis before accepting a mandate.
Ultimately, it’s not about whether an advisor wants your mandate — it’s about whether your company is truly sellable right now.
A little over a year ago, an entrepreneur contacted us. He owned a small chain of six restaurants and tapas bars in southern Spain. A solid, profitable business: around €6 million in revenues and €1.5 million in EBITDA, almost fully converted into cash.
“I have six restaurants, all doing well. I want to sell because I feel like doing something else, and I think it’s a good moment.”
We replied that, as always, before deciding whether to make a proposal to advise on the sale, we needed to do our homework.
We analyzed recent M&A activity in the restaurant sector — who was buying, at what multiples — and reviewed our notes and prior conversations with potential buyers.
The result was disappointing. There was barely any movement in that segment.
Large restaurant groups, including those backed by private equity, were focused on organic growth, opening new venues with their own capital rather than acquiring smaller chains.
Search funds, typically active in deals of that size, were not interested in B2C businesses with low recurrence, thin margins, and high staff turnover.
We also found no recent acquisitions among similar-sized chains.
Those that were five times larger could indeed be of interest to PE-backed groups — but not this one.
“Honestly, we don’t see active buyers for a business of this profile right now. It’s not that your company isn’t good — it’s that no one is buying this type of asset.”
We advised him to speak with local peers or small restaurant groups to test appetite in the nearby market.
We concluded that the universe of potential buyers was too limited and that none of the usual profiles fit the company or the market timing.
So we decided not to make a proposal for advisory services — not because the business wasn’t good, but because there were no active buyers for it at that moment.
Curiously, if instead of traditional restaurants it had been a churro shop chain, even with lower revenues and EBITDA, we might have seen it differently. In that case, there is a very active consolidator executing a roll-up strategy of independent churro shops under a single brand. There aren’t many buyers — but one is enough to justify at least an exploratory conversation.
Our process always follows the same logic.
First, we research.
We use paid data sources on companies, funds, and deals — PitchBook, TTR, Mergermarket, Sabi — along with our internal database built over hundreds of conversations with buyers, funds, and entrepreneurs.
This combination allows us to understand what types of deals are closing, who’s buying, and in which sectors there is real activity.
We start by mapping potential buyers.
For example, imagine an ERP for real estate agencies. €3 million in revenue, of which €2.4 million is recurring. €0.5 million in EBITDA, with 80% cash conversion.
Who could buy it?
We even look at comparable acquisitions in other countries to identify new buyer types we might not have considered — for instance, insurers aiming to strengthen ties with real estate agencies to sell tenant policies, using ERP adoption as a channel.
Then we check for recent activity.
If the sector shows movement and buyers are active, that’s the first box ticked. What matters is not whether deals happened three years ago, but whether they’re happening now.
Next, we assess size.
If comparable companies have been acquired at similar scale, we move forward. If not, interest usually fades.
Finally, we analyze pricing and multiples.
We review comparable transactions — based on revenue, ARR, or EBITDA — and also look at valuation multiples of potential buyers.
With that information, we align expectations.
If the founders’ valuation expectations are far from current market levels, we typically won’t proceed. Not because we hold the ultimate truth — pricing always depends on the buyer, synergies, and timing — but because we need to feel reasonably aligned.
The key question is not just whether a company can be sold, but whether it can be sold now, in this context, and whether shareholders’ expectations align with market reality.
Everything depends on the sector’s consolidation cycle, the presence of active buyers in that geography, and the company’s internal situation — whether it’s growing, generating cash, going through a transition year with heavy investment, or facing operational challenges.
Timing changes everything.
Three years earlier might have been ideal. Three years later might be again.
But right now — maybe not.
Once we complete this analysis, we decide whether to present an offer to advise on the deal.
If there are identifiable and active buyers, if the size fits, if valuation references are consistent, and if timing supports it — we proceed.
If not, we prefer to be honest and decline.
And it’s worth understanding something: most advisors are hungry for mandates.
So if a reputable advisor turns down yours, it’s probably not a matter of attitude or interest — it’s because they see the chances of selling the company, or selling it at the desired valuation, as low right now.
And if the only advisors you find are those asking for high retainers — say, €10,000 per month for a small company — be cautious. That’s a sign they’re not truly convinced they can sell your business, and they’re trying to transfer the risk to you.
By Joshua Novick, Partner at Bondo Advisors
Source: LinkedIn
cloud technology axon
Since Suma Capital’s entry in 2020, Gestcompost has quadrupled its E...
