OnwardLearn · Selling · Step 4. Know what buyers value most
Who your customers are, and how many
The short version
- Buyers want revenue spread across many customers.
- When one customer brings in a large share of revenue, buyers see risk, and the price reflects it.
- They also look at how long customers stay, how they found you and whether they would stay after you leave.
- You can prepare the answers now, before anyone asks.
Why concentration worries buyers
If one customer brings in a large share of your revenue and leaves after the sale, the buyer loses a large share of the earnings they paid for. They may also struggle to repay their loan.
Investors take this seriously. In Pepperdine's 2026 survey, more than half of private equity investors rated customer concentration as very important when judging business risk. Only future prospects scored higher.
What buyers look at
- Share of revenue. What percentage your largest customer, and your top five, represent.
- Tenure. How long your main customers have been with you.
- Contracts. Whether the work is under written agreement, and whether that agreement can transfer.
- Who holds the relationship. Whether customers deal with you or with your team.
- Mix. Whether revenue comes from one industry, one region or one type of customer.
- Trend. Whether customers are growing with you or shrinking.
When one customer is large
A large customer is not a deal breaker. Many good businesses have one. What helps:
- A written contract with time left on it, which can transfer to a new owner.
- A long history with that customer.
- Relationships that run through your team, not only you.
- Evidence the customer is happy, such as renewals or growing orders.
Buyers may still ask for protection, such as part of the price paid later.
Get ready now
Pull your revenue by customer for the last three to five years. Show each customer as a code, not a name. This becomes part of your data room. Lesson 2.6 covers the data room.
When you are ready to talk to someone
Nobody needs to know you read this. When you are ready, these are the questions to bring.
- For your accountant: "What share of revenue did my top customer and top five customers bring in each year for the last three years?" Listen for: a clear table, by year.
- For your M&A attorney: "Can my contracts with my largest customers transfer to a new owner?" Listen for: a contract-by-contract answer, including any that need the customer's consent.
- For a broker or valuation professional: "How would a buyer view my customer mix?" Listen for: a direct answer on concentration, and what would reassure a buyer.
Figures from Pepperdine Private Capital Markets Report, 2026. Benchmarks describe what happened in other sales. They do not predict yours.
When you’re ready
How a sale actually happens, in plain language — before you decide anything. Make a free account — nothing is shared