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Why Is Quality of Earnings Critical for Business Valuation with Patrick McMillian
Patrick McMillan is a seasoned fractional CFO and M&A advisor known in the deal community as the Q of E guy. As head of Transaction Advisory at Amplēo, he leads quality of earnings and financial due diligence engagements and collaborates with valuations, outsourced CFOs and controllers, HR, marketing, and sales tax teams across the deal life cycle. Drawing on his experience buying and selling companies and advising more than 100 transactions totaling over 2 billion dollars, Patrick explains what truly drives quality of earnings, why exit planning is good business planning, and how a quarterbacked team of advisors keeps founders aligned with their goals.
In this episode with host Mark Osborne on B2B Growth Blueprint, Patrick demystifies quality of earnings, multiples, and value acceleration. He shares practical steps owners can take in 90-day sprints to reduce risk, improve cash flow, and raise valuation while making the business easier to run today.
Quotes
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Quality could be high, medium, or low. A million dollars from one client is low quality. A million dollars from a hundred clients is high quality.
-
Exit planning is good business planning because you are de-risking and tightening operations long before a deal shows up.
-
You need a quarterback who aligns every advisor to the founder's goals and works in focused 90-day sprints.
Takeaways
-
Quality of earnings reflects the reliability and sustainability of profits.
-
Exit planning improves operations and reduces owner dependence.
-
Align all advisors under a single "quarterback" to keep goals clear.
-
Always be exit-ready—you never know when opportunity will knock.
Conclusion
Quality of earnings is a lens for building a stronger company now and a more valuable company later. By reducing concentration risk, improving cash to revenue proof, and aligning a cross-functional advisor team under a single quarterback, founders can move from the low end of the multiple range toward the high end while enjoying a business that runs smoother day to day. Exit readiness is simply smart, ongoing business management.
Links Mentioned
Website: Amplēo - https://ampleo.com/
Guest Links
LinkedIn Patrick McMillan: https://www.linkedin.com/in/patrickmcmillan/
View all episodes
By Mark OsbornePatrick McMillan is a seasoned fractional CFO and M&A advisor known in the deal community as the Q of E guy. As head of Transaction Advisory at Amplēo, he leads quality of earnings and financial due diligence engagements and collaborates with valuations, outsourced CFOs and controllers, HR, marketing, and sales tax teams across the deal life cycle. Drawing on his experience buying and selling companies and advising more than 100 transactions totaling over 2 billion dollars, Patrick explains what truly drives quality of earnings, why exit planning is good business planning, and how a quarterbacked team of advisors keeps founders aligned with their goals.
In this episode with host Mark Osborne on B2B Growth Blueprint, Patrick demystifies quality of earnings, multiples, and value acceleration. He shares practical steps owners can take in 90-day sprints to reduce risk, improve cash flow, and raise valuation while making the business easier to run today.
Quotes
-
Quality could be high, medium, or low. A million dollars from one client is low quality. A million dollars from a hundred clients is high quality.
-
Exit planning is good business planning because you are de-risking and tightening operations long before a deal shows up.
-
You need a quarterback who aligns every advisor to the founder's goals and works in focused 90-day sprints.
Takeaways
-
Quality of earnings reflects the reliability and sustainability of profits.
-
Exit planning improves operations and reduces owner dependence.
-
Align all advisors under a single "quarterback" to keep goals clear.
-
Always be exit-ready—you never know when opportunity will knock.
Conclusion
Quality of earnings is a lens for building a stronger company now and a more valuable company later. By reducing concentration risk, improving cash to revenue proof, and aligning a cross-functional advisor team under a single quarterback, founders can move from the low end of the multiple range toward the high end while enjoying a business that runs smoother day to day. Exit readiness is simply smart, ongoing business management.
Links Mentioned
Website: Amplēo - https://ampleo.com/
Guest Links
LinkedIn Patrick McMillan: https://www.linkedin.com/in/patrickmcmillan/