- The firm generates $8.0 million of gross revenue, which is a material scale indicator for a buyer.
- EBOC is 50%, showing that half of gross revenue remains after expenses before owner compensation and taxes.
- The firm produces 30,000 billable hours, indicating a substantial volume of chargeable work supporting the revenue base.
- With 4 partners and 20 staff, the firm has a defined operating structure that can support current production levels.
- Revenue per partner is $2.0 million, which is a meaningful productivity metric from a buyer’s valuation perspective.
- EBOC of 50% indicates only moderate earnings conversion, which can cap valuation versus higher-margin firms.
- The partner group is heavily senior, with ages of 54, 56, 64, and 76, creating near-term succession and transition risk that can pressure buyer confidence.
- Revenue is concentrated across just 4 partners at $2.0 million per partner, increasing key-person dependence at the ownership level.
- With 20 staff supporting $8.0 million of revenue, the firm appears relatively small in scale, which can limit operating leverage and increase perceived execution risk for a buyer.
- Strengthen succession and reduce key-person risk by formalizing transition planning for the 76-year-old partner and the broader partner group, which supports valuation stability.
- Improve leverage by expanding the 20-person staff base relative to 4 partners, creating more capacity to grow billable hours without proportionate partner time.
- Increase revenue per partner from the current $2.0 million by deepening delegation and optimizing the partner-to-staff mix, which can enhance scalability and margin durability.
- Protect and potentially expand the 50% EBOC margin by maintaining disciplined cost control as the firm scales, preserving earnings quality for valuation purposes.
- Partner succession risk is elevated because the partner group is older, with ages of 54, 56, 64, and 76, creating potential transition and continuity pressure in the near to medium term.
- The firm’s economics are concentrated at the partner level, with 4 partners generating $8.0 million of gross revenue and $2.0 million of revenue per partner, which can make value more dependent on a small number of individuals.
- Operating leverage may be limited by the 20-person staff base relative to 30,000 billable hours, suggesting the firm may have less capacity to absorb growth or workload shifts without additional hiring.
- While EBOC is strong at 50%, the absence of any additional practice or mix detail limits visibility into the durability and composition of earnings, which can increase diligence uncertainty for a buyer.