[plinkplonk]

This might be a dumb question, for which apologies in advance, but isn't 200 million a little low for a company with $ 50 million revenue? But maybe not, -- the profit is say $20 million and the acquirers are paying 10 X annual profit?

[paraschopra]

It's not a dumb question.

But what I learned in this process is that companies are valued after incorporating many factors (liquidity, earnouts, future involvement, growth rate, profit, retention, current market mood, etc. etc.) and multiples we see reported in media are obviously sit at the outlier curves.

I got a good deal overall (not just monetarily), and that's what I was shooting for.

[nfm]

Annual growth rate is typically a big factor in PE acquisition multiples. At a 4x multiple of ARR, I’d hazard a guess that this was on the lower side.

[chii]

at $20mil profit, that's a 40% margin, which is quite high, even for a tech company (tho for a startup, which can be nimble and agile, it's not impossible).