Revenue Won't Make Your Company Sellable

Maybe do a test if you want to solve that situation or you just want to test it to see if it's true for you or not.

Take a few days off and see what happens.

Well, she ran the numbers on more than 100 businesses that were for sale and the same thing kept coming up.

Founders with growing revenue who were certain, who were absolutely certain that that made their company's value valuable.

But the buyers, the writers weren't writing checks.

They didn't agree.

So welcome to the Real Jason Duncan podcast.

I am your host, the real Jason Duncan, of course.

And every guest on my show is here for one reason.

They used to believe something.

that turned out to be wrong.

It wasn't a small thing.

It's a belief that they might have built years of their life on.

And here's what I've learned about lies like that.

The dangerous ones, they don't look like lies.

They look like success.

They look like the revenue, the title, the growth, the thing that everybody told you to chase.

So you chased it.

And you catch it and then you climb inside it willingly and that becomes a golden cage.

And it's a cage because you're trapped inside this lie that's not true.

And it's golden because it looks so much like the thing that you want and it looks like you're winning and you'll even defend it.

So every conversation on this show digs into that cage, the lie that my guest believed and what it took to walk out of it.

That's what we talk about because the gold is the lie.

So let's get into it.

Today's lie is one that almost every business owner believes.

If my revenue is growing, my business is getting more valuable.

That sounds obvious, right?

If you sell more than you should be worth more.

And that's the gold in this cage.

Growth that you can point to, the numbers are up, everybody around you is calling it success.

But here's the cage part, you can grow revenue for 10 straight years

and still own a business that nobody will pay money for.

Because the people writing the checks aren't buying your growth, they're buying what's left when you walk out the door.

So my guest today found that out by sitting on the buyer's side of the table for over a hundred deals and watching founders get offers that broke their hearts.

And that is where we're going today.

My guest is Muriel Twitty.

She is a French entrepreneur based in New York City and the founder of Exit 3D Studio, where she helps founder led service businesses go from 2x multiple buyers offering, you know, going up to 6 to 8x.

And that's the difference between a transferable business and not a transferable business.

But before that, she sat on the buyer side of more than 100 deals in the data rooms running due diligence.

And she's the author of a brand new book that just came out last month called The Valuation Gap, What Buyers See That Sellers Miss.

It's out now on Amazon and you go check that out.

We'll be talking about that.

So Muriel, welcome to the show.

Thank you, Jason, for this great introduction.

Well, I'm so glad that you're here.

And I know that my listeners don't get to hear a beautiful French accent often.

So this is a treat.

Even if we don't talk about anything interesting, it's going to be interesting.

It's going to be interesting.

But it is going to definitely be interesting because as you and I talked about pre show,

this today we get to talk shop and I'm going to speak to the listeners for just a second who listen consistently.

You will know Mr.

Mrs.

Lister that just last week, I released another episode with Mark Hartman where we talked about a very similar topic.

And this is not this happened by accident.

We did not plan this.

This is two episodes back-to-back on a similar idea.

But you now you're going to get to hear a female perspective.

You're also going to hear a different perspective from a different business perspective.

So

Muriel, before we get into this, I told people listening that that you came here to expose a lie that you used to believe that if that if revenue is growing, your business is becoming more valuable and you've built companies on both sides of the Atlantic.

And then you spent a year as a buyer looking at over 100 businesses.

So I want to start right there.

Could you state the lie the way that you would say it to a founder's face and then tell me where that belief came from?

Sure.

Well, when I was looking at the financials of a business and I could see the growth, I was actually looking at more than that.

And so if I was facing a founder or in most case, a business broker, because they are in the middle of that relationship, when you want to buy a business, I will explain that

like one or two clients driving all the revenue is more of a red flag for me than a real proof of growth because customer concentration, revenue concentration is never a good thing in a business.

This is one example, but actually identified even for structural gaps that

tend to discount any businesses if they have this, even if the revenue look good, even if the business is growing, they will still sell for less than those who have fixed those four structural gaps.

Yeah.

And what are the four structural gaps?

Be very clear about what those are.

Yes.

So I mentioned the customer concentration.

This is when one single client represent more than 20% of the revenue.

For example, even 10% of the revenue is a risk because that means that when one client decide to stop working with the business, often when the founder leave,

you lose directly those 20% of revenue.

So, and sometimes it's even bigger than that.

It can be three clients representing 80% of the revenue, you know, depending on the business.

So this is a big one.

The other one as big, I think is the founder dependency.

When all the sales are coming thanks to the founder, all the decision are taken by the founder.

part of the delivery or managing the team, if the founder is necessary for the business to run, it loses value.

because when a buyer is looking to acquire a business, is not buying the founder, this is just not possible.

So that means things will, the transition will be difficult and even the founder won't get the clean exit they are looking for if they are still involved in a lot of activities.

The third one is the revenue predictability.

Can we anticipate future revenue based on the past three years plus trading 12 months?

If there is a growing trend, that's great.

We could imagine it continue if it's not that founder dependent and there is no customer concentration and the type of the quality of the revenue

give us, you know, chances to think that the revenue will continue.

For example, in contracts, if there are retainers and things like that.

But if the revenue come from project based work, for example, we know that this can be inflated, especially in the last year when a founder want to leave, he might be signing a lot of contract.

And then just to show how it's growing.

But then we know there is nothing after that when it's a project based type of revenue.

And the fourth one is everything digital.

I will say the digital asset of the business, including the acquisition engine.

Can the business generate leads and business from their own

online presence basically from their social media from their website or is it just for sure online that generate no traffic and have no you know that make us think prospective buyer that the the business is only getting business from referral and not actually

organically or through a real pipeline?

So Muriel, take me inside one of those data rooms back when you were doing all those deals.

Somewhere in that year, you know, I'm sure there was a business that you wanted to like, that you were reviewing, like, oh, I want to like this.

It was growing, it was profitable.

A founder who was, you know, from all accounts doing everything right on paper, but you still had to price it like a risk.

Oh yeah, I'm a good one.

Yeah, walk me through that deal.

What'd you see in the numbers that the founder couldn't see in the mirror?

Yeah, so at some point I got an offer accepted.

It was for marketing agency, especially a LinkedIn, lead Gen.

agency, because it was my expertise as a consultant and

trainer.

So I thought, okay, I will understand better this business.

Let's go.

I like it.

It seems to be profitable.

The kind of marketing brochure the business broker gives you look good.

I made that offer for what they wanted.

They wanted $3.7 million for it.

They had, I think the cash flow was about 850.

So it was a multiple of about four.

That was four, four and a half.

That was good.

I was comfortable and I even had a bank that was following me with this.

But then when I was

Finally uncovering everything in the data room, looking more seriously at the numbers and starting to ask questions about the customer list, for example.

what I was really going to get out of it, then I discovered things that was too much of a red flag.

For example, the business was generating a lot of leads from the LinkedIn profile of the founder.

Of course, it was out of the sale.

So okay.

And then supposedly I was going to buy also all the LinkedIn profile of the whole team.

Again, can I really buy that?

Do we buy the LinkedIn profile of people?

No, we don't.

So this was the way they were doing business.

And this was not part of the sale.

So this was an issue.

And then when I, and they didn't want to give it to me, I took them some time to give me the customer list with the revenue per month, per client for the past year.

And this is, so I was able to see how long each client was staying and why did we, if they were growing so much, like why did I have 35 client in August and still 35 client in December?

So that was an issue I needed to understand.

And when I looked at everything, I was able to see that all the clients they were getting, they were out after the three months contract.

They had what we call a logo churn of about 40%.

months, the business was leaking, actually leaking revenue.

They were able to always get new ones because when you're good, you know, at lead generation on LinkedIn, you're able to get new client.

But if you cannot retain them, there are several issue, you know.

Teaser, their service was poor and the customer were not happy.

Or in the opposite, maybe they were happy, but they had too much volume, too much to handle after and they could not deliver.

Or they were understaffed, they needed to hire a bit more like customer success manager, for example, they only had one for 35 clients that it was not able to,

you know, to retain those customers or serve them properly, I think.

So yeah, this is a specific deal and it was not even things

about the revenue itself, the revenue was there, fine.

Okay, maybe a couple of addbacks I didn't agree with, okay.

But this, that the revenue was leaking every month, I didn't see that as an opportunity.

It was more after all my calculation, instead of evaluating the business 3.7 million,

I was going to evaluate it more like a 1.1 time EBITDA, which was about, I don't know, 650,000.

And even then I decided to walk away and say, I don't feel comfortable buying such a business.

Well, that that had to be a gut check for the owner.

What did the owner.

think when you told him that or her that.

Well, there was again, I had the broker in the middle that was doing the intermediary.

It was such a weird situation where I saw just a video of the founder.

I never talked to him.

And yet there was someone else who signed my letter of intent.

So they even had another owner somewhere in Asia.

Like it was too

I don't know if shady is the right word, but that was too obscure for me.

And I never got to really speak to the owner either.

Just so in presentation.

Yeah.

Well, I want to ask you about when you made the decision to go from analyzing the deals in the data rooms to actually being the person with your own studio, helping people do these deals.

But before I do that, I'm gonna give you a second to think about it, but that's what I wanna talk about next.

But before we get there, I wanna talk to the listeners directly about a couple of things.

Let's take a quick break to thank our amazing sponsors for making this podcast possible.

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And in 60 minutes,

I'm gonna walk you through the biggest mistakes that founders make that kill their company's value and what buyers can actually look for before they write a check.

And you know, Muriel and I are talking about this today.

So this is stuff that I can teach you in this live webinar.

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That's whattofixbeforeyouexit.com.

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We can do that too.

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Now, back to the show.

Okay, so Muriel, you sat in these data rooms analyzing these deals for a long time.

What made you want to stay?

I don't want to analyze these for somebody else.

I want to do these deals myself.

What made you make that move?

And when did you do that?

Well, before starting to analyze deal, I had, you know, my own business and I had, you know, I was working with French entrepreneurs to help them leverage LinkedIn.

And it's in 2025 that I didn't really have an offer for the US.

So then I started to look

to buy a business instead of creating one.

And because I bump into this same issues over and over, all founder dependent business, unpredictable revenue, customer concentration, no acquisition engine, no digital asset that was worth something to me.

I decided and the story that I told you before with my offer accepted, this was the point where I had more than enough.

I said like, it is too much.

This is the

Accommodation.

I only have the word in French of too much, you know.

So I decided, okay, I can create a website and I can create an offer and just go from there.

And in the

And now I do have some businesses to prepare for an exit, but mainly I felt that maybe 90% of them, they are not planning to sell yet.

They are just looking at growing the business.

So this is a lot what I'm focusing on and building that acquisition engine that they don't have and that solve.

actually three, the three others issues ultimately when it's done well.

So that is exit 3d studio.

That's your company.

And as you just explained it, your job is to help them figure out the acquisition engine so that it fixes the customer concentration problem, the owner dependency and the revenue predictability.

So when you do that, do you have a specific type of business that you're working with or industry or, or what?

Yes, I do.

I work mainly with B2B service business owner and even more specifically, I have, you know, been working a lot with consultants, consulting firms.

So those and tech company and professional services in general.

So B2B service business owners.

Give me an example of a client that you're working with now and what you're doing for them.

Well, I run a done for you system that gets

them, the B2B service business owner, warm leads through LinkedIn and e-mail working together.

I handle their positioning, their content and their lead Gen.

and they just show up to close.

So it saves them a lot of time.

It does not solve the whole founder dependency because depending on what they are doing and some still like to deliver

But it solves the founder dependency on the marketing and a good part of the sales side as well.

All right.

So when you've got a client or you're talking to a founder who you've watched these founders get discounted

because they built a company that was founder depend or owner dependent that that had too much customer concentration, all the things you've talked about.

You know, these people aren't dumb and they're not lazy.

They did everything the way they were taught.

but the market still handed them a bill that nobody warned them about.

It's like your business is not sellable.

So think back to yourself 20 years ago when you were starting out or whenever it was that you got started.

What do you know now that you wish someone had told you 20 years ago as an entrepreneur or an aspiring entrepreneur that nobody told you?

Yeah, I have a good one.

And actually someone told me, a mentor told me that was the way of doing it.

So even worse, I was trusting that.

It's when I built my online training and coaching program.

So to detach myself a little bit and have, you know, serving several clients at the same time, I was told it was good to charge the client upfront

and serving them forever.

That was the worst idea because I had to be consistently, you know, bringing new leads, getting new client every month.

Otherwise there were no more revenue coming in.

You know, I didn't have any retainer and this was a big lie.

And this is something that I'm definitely not falling for

And I advise like every time, even like new business owner, like new creator of a business that they should choose, you know, the right business model from the beginning.

Like not make that mistake because you be stuck in your business.

You have no predictability.

It will be uncomfortable, risky, all of that.

Well, with Exit 3D Studio, is it more about doing managing the customer acquisition channel or is it actually preparing them for an exit or am I missing something?

They have three different packages.

So there is one package that help them to let's say the first one, the growth program is to build that acquisition engine.

kind of the foundation.

In the SCALE program, we diversified acquisition channel just to have a bit more than one, just in case.

And in the Exit Ready program, we build all the, on top of that, we build the digital asset as well.

So when they sell, they will be prepared for the digital due diligence

Basically, plus I could refer them to, you know, potential buyer.

I am part of a business buying community and, you know, also have content into finance and different, you know, with lenders and stuff so they can also get, you know, SBA approved and I can give them based on what I see their potential valuation.

So this lie that we're discussing today with you, Muriel, is about that really is based that profitability or revenue rather, not necessarily profitability, revenue and your value are directly correlated.

And that's certainly not true.

Even if you're more profitable, that doesn't make you more sellable or marketable.

And here's what I think makes that cage so nasty because the bars on that cage are made out of our own wins.

Like we're winning, we're selling more, we're more profitable.

Every client has maybe come through because I was there, I was involved.

Every record month I hit is because I outworked everybody and it feels like value, but it prices like risk, you've just explained that.

So let's put the truth on the table.

So you got two founders, same industry,

Same profit, same growth curve.

One gets offered 2x, the other gets offered 7x.

Tell the audience the difference between those two owners, not the businesses, the owners.

Yeah.

So I will say that the one that sell at 2x or even just one x as the one they they were leaking revenue.

They don't have a way of retaining customer.

All the sales are founder dependent.

The founder is also managing all the service and looking and checking.

They have some customer concentration as well.

And well, those are, those are about the business though.

Like tell me about the owner.

Like what do you, you're a professional, you've seen this happen when the owner.

Yeah.

What's the difference between those two people?

Well, I guess it would be about the delegation mostly.

Like do you have even hire a CEO for your business and you are just there for the vision?

This one, they sell for a lot of money because they are selling a business.

They are not selling a job like the other one.

That's it.

That's exactly right.

Now, your book that just came out last month, The Valuation Gap, What Buyers See That Sellers Miss, like where did that come from?

Why did you want to write that book?

And what's the kind of the central tenant of the book?

Yeah, well, it talks about the four structural gaps that all founders should fix to unlock more growth and exit at a higher multiple that they could today.

It comes from all the year that I spent evaluating business as a prospective buyer.

I just had too much

too much material not to use it and and write something about it.

And as I was launching also a new business exit 3D studio in a market where nobody knew me, I felt, you know, that I had to justify a little bit, just show a bit of proof of who I am, what I'm talking about.

And I thought that I never wrote a book before.

And I saw that writing this book will be a good way of getting familiar with my work and how I approach this.

Well, for people that believe the lie, what's the cost of staying inside that lie, say for another five years?

And then what's waiting on the other side for somebody who decides not to believe the lie?

Well, the first consequence is

Can they really go on vacation and enjoy?

Because usually they have to bring their laptop with them.

They have to check a bit every day, the mail, even if they put an out of office notice, I'm sure they are still checking.

That's the first consequence.

Depending what they are going through, if they have a team, not a team.

I know that for those who doesn't have a big team, sometimes the business stop completely when they are not there.

They cannot serve the client, they cannot sell, they don't have and they cannot do any customer support as well, so the business completely stop.

You know, before we close, Muriel, I want to give you one minute and I'm not going to interrupt you.

I want you to tell the world as directly and passionately as you can what this lie is that we've been talking about, why they've been believing it, and what the truth actually is.

Go.

Yeah, you probably believe that growing your business consistently, putting a lot of effort in your business was the way to have a business that is more valuable for a potential buyer, but that is not.

What's make a business more valuable is simply saying like a business that run without you.

Because if you run the business on the day-to-day, you cannot go on vacation.

No buyer is going to pay a premium for your business to actually buy himself a job.

This won't be happening.

And that's not just about founder dependency.

If you are proud to have two clients that bring 80% of the revenue

that is a red flag for buyers.

So maybe think about building an acquisition engine, just bring more leads, diversify your portfolio of client and hire maybe someone or build system so there is less charge on you, less things you need to handle.

So tell people how to find you, Muriel.

To find me easy on LinkedIn.

You can find me on LinkedIn.

You can find my book, The Valuation Gap on Amazon and visit my website as well where we can connect and you can also book a call to talk directly.

It's exit3dstudio.com.

And then LinkedIn, you can find her at Muriel Twati, and that's T-O-U-A-T-I.

That's how you spell her last name and the valuation gap on Amazon.

All right, Muriel, final question.

If someone listening right now is still inside that lie, they're still believing it, what's the one thing that you want them to hear before this episode ends?

Well, I think I mentioned it before, but maybe do a test if you want to solve that situation or you just want to test it to see if it's true for you or not.

Take a few days off and see what happens.

And when you come back, if you notice that there were no sales, your team was not able to take

one decision, a client relationship was difficult, but those are the things you need to fix first because that means that you are holding the whole business yourself and the revenue are there because of you, not because of the business.

That's a good advice.

So take a few days off, do the test, see if everything works.

And if it doesn't, you've got some work to do to get yourself out of the owner dependency trap.

Muriel, thank you so much for being on the show today.

It's a pleasure to meet you and congratulations on what you've built and how you're helping people build their businesses better.

Thank you, Jason.

It was a pleasure to have this conversation with you today.

All right, that's a wrap on today's episode.

If today you saw a bar on your cage that you hadn't noticed before, send this episode to someone who needs to see theirs.

The gold is the lie.

As always, I am your host, the real Jason Duncan, and Jesus is King.

We'll see you next time.

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