There is a wave of selling coming in Australia’s lower mid market. And it’s not far away.
Demographics rule the future – and the lower mid-market is no different.
Here are basic stats:
- there are around 100,000 Australian businesses with annual revenue between $2m and $10m revenue.
- and there are another 40,000 with annual revenue above $10m per year.
- around 25% of the Australian population is between 45 and 65 years of age.
Business owners tend to be older (though that is changing). Lets assume 50% of the 100,000 businesses of interest are in the 45-65 y.o. bracket with 50% of them looking to retire and sell their business in the next 7 years. That works out about 3,500 business for sale each year.
But the wave is delayed.
Whatever else COVID has done, it has meant ‘unseasonal’ business performance. Some businesses have done it tough – some have had a bump.
So for a lot of businesses ‘now’ is not quite the time to sell. They need a few years of growth on the books before bringing the business to market.
Which means there is pent up demand coming on the sell-side.
The wave of lower mid-market deals is coming – it might be a bit delayed due to COVID – but when it hits, it will be even bigger.