Become a Business Broker

It requires real deal expertise, so few people enter, even as a record wave of retiring owners needs help selling their businesses.

1. 1

   Check your state's licensing rule

   Several states, including California and Florida, require a real estate license to broker business sales; others require nothing. Confirm this first because it sets your timeline and budget.

2. 2

   Learn valuation before you list

   Study SDE (seller's discretionary earnings) and the multiples common in Main Street deals, typically 2x to 3.5x SDE. IBBA courses and the CBI credential are the standard training path.

3. 3

   Set up the deal infrastructure

   Form an LLC, get E and O insurance, and have an attorney prepare your listing agreement, NDA, and buyer registration forms. Your commission only exists if the paperwork holds.

4. 4

   Build a referral bench of advisors

   CPAs, estate attorneys, and commercial bankers hear 'I want to sell' months before anyone else. Meet them monthly; they are your deal flow.

5. 5

   Win one honest listing

   Take on a small local business you can genuinely value and package: financials recast, a blind teaser, and a confidential information memorandum. Overpriced listings stall your first year.

6. 6

   Market and qualify buyers

   List on BizBuySell and BizQuest, then screen every inquiry with an NDA and proof of funds before sharing details. Ninety percent of inquiries are tourists; filtering is the job.

7. 7

   Shepherd the deal to close

   Manage due diligence, financing (often SBA 7(a)), and the landlord and license transfers. Commissions of 8 to 12 percent on small deals reward the broker who keeps it moving.