Their internal valuation is based on the return on the total investment required to pay you and to develop the business. When you have a real business, the focus shifts from sales potential to the actual rate of sales growth. Institutional investors will also look at the gross margin because that's usually a good indication of how unique your product is and how profitable the business can potentially be. Corporate investors at this stage will also pay attention to management quality and organizational depth, because the company must be able to sustain itself after being acquired. As the company matures, investors will look at earnings in addition to sales growth.
Corporate investors tend to look at the earning power.
Eventually, conservative investors will base their valuations on assets, expected earnings, and even dividend rate. How the exit actually occurs is the easy part. There are professional specialists in financial services, like investment bankers and business brokers, who are trained to help you plan and implement the transaction. Once you make up your mind and sign on, the project takes on a life of its own. The ultimate value we create for ourselves is the happiness that goes with self-esteem and the personal satisfaction of a job well done.