Six types of business buyers and how to find them

Executive overview

Most founders sell to the first buyer who shows interest and leave millions on the table. The type of buyer determines the multiple you receive — and most founders have no idea which type they're likely to attract.

Six buyer types exist, ordered from highest to lowest typical payout: strategic buyers, private equity, search funds, high net worth individuals, co-founders, and your own network or employees.

Identifying your most realistic buyer type before you go to market is the single biggest lever on exit value.

The six buyer types

1. Strategic buyers — companies in your space acquiring for a specific reason (complementary product, platform ownership). Pay the highest multiples. Only target businesses doing millions per year; want team, not just tech. Common misconception: most acquisitions are not strategic — in SaaS at $2M+ ARR, ~80% are private equity.

2. Private equity — pools of capital that buy, grow 3–5x over 3–5 years, then sell. Common and well-funded. Risk: value-focused PE can strip the business down. Current entry point: roughly $2M ARR and up.

3. Search funds — an MBA graduate raises capital to buy and run a single company as CEO. Targets businesses too small for PE. More common outside high-tech: services, manufacturing, brick and mortar.

4. High net worth individuals — typical profile is a late-40s/50s executive with $2–5M in savings using 90% SBA debt to buy a cash-flowing business in the $1–5M range. Will buy businesses that PE and strategics pass on.

5. Co-founders — buyouts happen when growth stalls or a co-founder has a life change. Usually priced at a discount to full market value (e.g. 2–3x net profit vs 5x), since one party needs to raise cash quickly.

6. Network, customers, or employees — common for brick-and-mortar and small franchises. Deal sizes are smaller; often structured as split sales to multiple buyers.

How to find buyers

• Inbound interest — PE, strategics, and search funds reach out directly. Worth fielding even if not ready; log contacts in a spreadsheet for when you are.
• M&A broker / investment banker — runs a full auction process, reaching out to 100–150+ buyers. Best for $2M–$20M ARR SaaS (e.g. Discretion Capital). Expects multiple LOIs to create competition.
• Online broker — (e.g. Quietlight) serves smaller online businesses (SaaS, e-commerce, content). Buyer lists of 20,000–40,000 high net worth individuals and search funds.
• Online marketplace — (e.g. Acquire.com, Flippa) self-serve, for-sale-by-owner listings. Suitable for very small businesses or experienced sellers who don't need a broker.

Matching buyer type to deal size