The Intent
You want a way to track whether strategic decisions are actually increasing value over time, not just revenue or workload.
How I Solve It
I use the 25 Factors Affecting Business Valuation as measurable indicators, revisiting them periodically to assess progress. Factor #13: Management Capability, Factor #14: Client Base, Factor #6: Scalability, Factor #24: Risk, and Factor #25: Opportunity provide a balanced view of value creation.
The 5 Senses Inspection Report acts as a reality check, ensuring that improvements are embedded in behavior and systems, not just documented.
Experience
It is vital because "How do you measure business value drivers?" is not a mechanical calculation. It is a real-world judgment about risk, control, sustainability, and transferability — and that judgment is where 10–15 years of owner-operator and valuation experience, your gut–brain axis, does the heavy lifting.
Why It Is Not Mechanical
On paper, valuation appears formula-driven. In reality, governance rights, risk concentration, growth durability, market conditions, and stakeholder dynamics materially affect value.
Where Experience Changes the Number
Decisions around normalization, premiums, discounts, projections, and defensibility require judgment formed through lived ownership, negotiation, and financial accountability.
Why the Gut–Brain Axis Matters
The brain performs disciplined financial analysis. The gut recognizes unrealistic narratives, hidden leverage, emotional distortions, and deal risk. Together they produce conclusions that withstand scrutiny.
Protecting Financial Lives
The final number affects wealth, control, solvency, tax exposure, and long-term relationships. Requiring 10–15 years of serious hands-on business and valuation experience ensures the answer is fair, defensible, and durable. See my Experience page.
The Result
You gain a repeatable method to measure whether the business is becoming more valuable year over year.