Purchasing Clients - What is a reasonable asking price?
I have very recently left my national firm to go out on my own. Incredibly freeing and I’m excited for what‘s next!
At my previous large national firm, I mostly worked with our large corporate clients and very HNW individuals that aren’t really a fit for what I want to focus on going forward. However, I have about $100k worth of clients that are smaller businesses and more Average Joes that have indicated they want to follow me. I obviously have non-competes and completely understand that I’ll need to purchase the relationship from my former firm. My separation was very amicable and I plan to keep it that way.
What is everyone seeing out there as a reasonable multiple for purchasing clients? I’ve heard my Firm is generally asking 2X annual revenue, which seems a little steep but is in line with my 2 year non-compete. These are clients that my Firm wouldn’t even notice are gone, so I’m hoping to counter with something less.
Any thoughts out there as to what the going rate is?