Selling a business is usually a once-in-a-lifetime decision, and the person you pick shapes the price, the buyer, and how private the process stays. First decide what you need: a broker who markets and sells the business, or an independent valuation (for planning, a partner buyout, divorce, or an SBA loan). Sometimes you need both.
Last updated October 15, 2026. Free to read, no sign-up. Sources are linked at the bottom.
Broker or valuation expert?
- Business broker: markets the business, screens buyers, keeps it confidential, and helps negotiate. Usually paid mostly when the business sells.
- Valuation expert / appraiser: writes an independent opinion of value for a fee, whether or not you sell. Lenders, courts, and the IRS often expect a credentialed appraiser.
- Your CPA and attorney: handle taxes, deal structure, and the purchase agreement. A broker doesn’t replace them.
Check the license: California DRE
In California, selling a “business opportunity” (an existing business and its goodwill) for a fee is real estate brokerage under the Business and Professions Code (§10030 and §10131). In general that means a business broker needs a California real estate license from the Department of Real Estate (DRE). Look up any broker free on the DRE public license lookup: check that the license is active and whether any disciplinary action is listed. Securities firms can fall under different rules; ask how they are licensed.
Check credentials for a valuation
No single license is required to write a business valuation, so look at credentials and experience. Common ones: CVA (NACVA), ABV (AICPA, for CPAs), ASA (American Society of Appraisers), and for brokers the CBI (International Business Brokers Association). Ask how many valuations they’ve done in your industry and for a sample report with names removed.
Understand how value is estimated
Small businesses are often priced as a multiple of seller’s discretionary earnings (SDE). BizBuySell’s 2025 year-in-review reported an average multiple around 2.6x, with industries ranging from about 2.3x (restaurants) to 2.8x (HVAC). Your number depends on records, trends, customer concentration, lease terms, and how much the business depends on you. Try our free value estimator for a range, then ask any broker or appraiser to explain their method in writing.
Read the listing agreement carefully
- Fee: how it’s calculated, any minimum fee, and whether anything is due up front (not automatically wrong, but know what you get for it).
- Length and exclusivity: how long you’re committed and how you can end it.
- Tail clause: whether you owe a fee if you later sell to someone they introduced, and for how long.
- Asking price: how they arrived at it. Be careful with anyone who promises a much higher price than others to win the listing.
Have your attorney read it before you sign.
Confidentiality
Employees, customers, and competitors finding out too early can hurt the business. Ask how they advertise without naming you, whether buyers sign a non-disclosure agreement before seeing details, and how they check proof of funds before sharing financials.
Questions to ask
- Are you licensed with the California DRE? Can I see the number?
- How many businesses like mine have you sold in San Diego County?
- How will you set the asking price?
- What’s your fee, minimum fee, contract length, and tail period?
- How do you screen buyers and protect confidentiality?
- Who will I work with day to day?
Red flags
- No DRE license, or can’t show one
- A valuation far above everyone else’s, with no explanation
- Large up-front fees with vague deliverables
- Sharing your financials before a buyer signs an NDA
- Pressure to sign a long exclusive agreement on the first call
Questions
Does a business broker need a license in California?
Generally yes. California treats selling a business opportunity for a fee as real estate brokerage (Business and Professions Code §10030 and §10131), so a business broker usually needs a California DRE real estate license. You can check one free on the DRE public license lookup.
What is the difference between a business broker and a business appraiser?
A broker markets and sells the business and is usually paid when it sells. An appraiser writes an independent opinion of value for a fee, which lenders, courts, or partners may require.
How are small businesses usually valued?
Often as a multiple of seller’s discretionary earnings. BizBuySell’s 2025 review reported an average around 2.6x, varying by industry and by the business’s records, trends, and risks.
What should I look for in a broker agreement?
The fee and any minimum, up-front charges, the contract length and exclusivity, the tail clause, and how the asking price was set. Have your attorney review it.
Sources (checked October 15, 2026)
- California DRE: public license lookup
- California B&P Code §10030, "business opportunity" (public.law)
- California DRE: Real Estate Law (incl. §10131)
- BizBuySell: 2025 year in review (SDE multiples)
- NACVA (CVA credential)
- IBBA (CBI credential)
- U.S. SBA: buy an existing business