Small Business Valuation — Intangibles and Creating Value (Part 4)

A business’ value is created in the intangibles, what is above and beyond hard assets.

Buying good assets can value but does not create it. Any other business can buy the same machines, office space, or inputs/supplies. Aside from real estate, tangible assets are unlikely to appreciate. Entrepreneurs and small business owners need to focus on the intangibles to create wealth. The intangibles are what is hard to recreate and replace.