Published: 2026-04-30 | Last Updated: 2026-04-30 | By: Scott Sylvan Bell | Location: Teahupo’o, Tahiti (-17.8478, -149.2667)
How Do You Grade Your Business Deal From A-Plus Through D?
Direct answer: Business deals grade from A-Plus through D based on how prepared the seller is and how complete the documentation is going into market. An A-Plus deal earns 12-17x EBITDA when industry expects 6-10x. An A deal earns the upper end of industry range — roughly 10x. A B deal has missing items and profitability issues, earning around 8x. A C deal has significant gaps. A D stands for “Don’t Do It” — the seller is not ready, and even at 50% of expected multiple the deal is not worth pursuing. The grading scale is built on Titans thesis preparation, clean financials, quality of earnings reports, SOPs, org charts, opposition research, and a 2-5 year runway before going to market.
This post covers deal grading specifically for owners building toward exit. The companion frameworks are detailed in the Exit Ratio 360™ system, the EXIT Framework for due diligence preparation, and the SCORE Framework for measurement discipline.
The defensibility principles here connect directly to quality of earnings reports, the buyer-type strategy in private equity vs strategic buyer, and the documentation infrastructure in what is a data room when selling a business.
The Deal Grading Scale — A-Plus Through D
| Grade | What It Means | Multiple vs 6-10x Industry Range |
|---|---|---|
| A-Plus | Everything in place, opposition research done, NPS tracked, full Titans thesis | 12-17x (premium expansion) |
| A | Good company, most boxes checked, minor gaps | ~10x (top of industry range) |
| B | Items missing, struggling with a few things, profitability issues | ~8x (middle range) |
| C | Significant gaps in documentation and operations | ~6-7x (bottom of range) |
| D | Don’t Do It — seller not ready, deal not worth pursuing | ~50% of expected — walk away |
| Runway needed | A-Plus requires 2-5 years preparation, not day-of-sale work | Time is the leverage |
The 8 Components That Determine Your Deal Grade
- Titans thesis (seller’s thesis on steroids). Your structured statement of what you want from the sale — multiple range, deal structure, employee outcome, post-sale role, walk-away conditions. Without a thesis, you accept whatever the first credible buyer offers. With one, you negotiate from defined criteria.
- Industry multiple research and timing. You track where multiples sit in your industry and whether the industry is growing or shrinking. Timing matters — A-Plus deals catch the industry on the upswing, not after the peak. Sellers who don’t track this miss the timing window.
- Standard operating procedures and org charts. Documented processes for every revenue-producing activity. Current org chart with reporting lines plus written job descriptions for every key role. Buyers credit operational maturity directly through the multiple.
- Quality of earnings reports. Three-year QoE history with documented add-backs, adjusted EBITDA reconciliation, and revenue concentration analysis. Sellers who validate their financials through QoE before market hold the upper end of their multiple range.
- Clean financials. Audited or reviewed financial statements covering 3-5 years. Clean financials and QoE reports work together — the QoE validates what the clean financials present.
- Buyer presentation deck. A polished presentation prepared as if you are presenting to your ideal buyer right now. Most sellers build this on the day a buyer asks. A-Plus sellers have it ready 12-18 months ahead of market.
- Opposition research and competitive positioning. Documentation of where your business sits in the market versus competitors. Buyers credit sellers who know their competitive position and can defend their differentiation with data.
- Net Promoter Score, Employee Promoter Score, referral and recurring revenue processes. Quantified customer satisfaction, employee engagement, referral velocity, and recurring revenue ratios. Each metric tracked over 12-24 months becomes a multiple-supporting data point.
Frequently Asked Questions About Grading Your Business Deal
Direct answer: These ten questions cover what each grade means in dollar terms, what makes the difference between grades, and how to position for the A-Plus tier 2-5 years before you intend to sell.
What is the difference between an A-Plus deal and an A deal?
An A-Plus deal has every component in place — full Titans thesis, opposition research, NPS and EPS tracking, recurring revenue processes documented, clean financials, three-year QoE, polished buyer presentation. An A deal has most components in place with minor gaps. The dollar difference is significant: A-Plus earns 12-17x where industry expects 6-10x. An A earns roughly 10x. On $1M EBITDA, that is a $2M-$7M difference.
What does D stand for in the grading scale?
D stands for “Don’t Do It.” When sellers reach out and say they want to sell their business, the diagnostic process sometimes reveals they are not ready. They will earn roughly 50% of expected multiple if they push forward. The honest answer is to walk away from the deal at this stage, take 2-3 years to position properly, and come back as an A or A-Plus seller. D-grade deals leave 50%+ of the value on the table.
How much runway do I need to position for an A-Plus deal?
Five years, four years, three years, or two years before sale gives you the time to position properly. Sellers with shorter lead times accept whichever offers come first. Sellers with longer lead times can develop the operational maturity, build the QoE history, document the SOPs, and structure the operations to attract premium offers. The A-Plus tier requires runway, not last-minute work.
How do I know what an A-Plus deal looks like in my industry?
Reach out to buyers in your industry — strategic buyers, private equity, investment groups — and ask directly: “What is it that you look for in an A-Plus deal? If I wanted the maximum multiple, what would need to be true?” Nine out of ten will tell you the criteria. Some are persnickety and will not divulge — that is fine, you do not need every buyer to participate. The information is gettable when you ask.
What is a Titans thesis?
A Titans thesis is the seller’s thesis on steroids — your structured documentation of every detail a buyer might need, ready before they ask. It includes the multiple range you expect, the deal structure you want, employee outcomes, your post-sale role, earn-out terms, walk-away conditions, your complete data room contents, and your competitive positioning. Building it 2-5 years out is the foundation of an A-Plus deal.
How does timing affect my deal grade?
Industry multiples cycle. When your industry is growing, multiples expand. When it is contracting, multiples compress. An A-Plus seller catches the industry on the upswing, with all preparation already complete, ready to move quickly. A seller who waits for the peak then starts preparing arrives at market after the peak passes — earning a B or C grade on a deal that could have been A-Plus six months earlier.
What if I am not ready for an A-Plus deal yet?
The honest answer is to take the time to prepare properly rather than push forward at a lower grade. The dollar difference between grades is substantial — often equal to 5-15 years of personal earnings on a single deal. A two-year preparation runway frequently doubles the multiple. The rushed seller leaves more money on the table than the patient seller pays in waiting cost.
What does “opposition research” mean in deal grading?
Opposition research is documenting your competitive position with data. You know your top three competitors, their strengths, their weaknesses, their multiple ranges, their customer churn, their growth rates. You can articulate why your business is differentiated and defend that differentiation with evidence. Buyers credit sellers who walk in with this research already complete because it signals strategic sophistication.
How do NPS and EPS scores affect my deal grade?
Net Promoter Score (customer satisfaction) and Employee Promoter Score (employee engagement) are quantified data points that buyers underwrite. Strong NPS signals customer retention and word-of-mouth growth. Strong EPS signals operational maturity and key-person risk reduction. Both tracked over 12-24 months become multiple-supporting evidence — typically worth 0.5-1.5x EBITDA on the multiple buyers offer.
Can I move from a B grade to an A-Plus grade?
Yes, with time and discipline. The path is documented: implement the Titans thesis, run three years of quality of earnings reports, document SOPs and org charts, track NPS and EPS, complete opposition research, build the buyer presentation, and time the market entry. A B-grade seller who commits to the upgrade process can typically reach A or A-Plus tier within 18-36 months of focused preparation.
Full Transcript From the Video
Direct answer: The full cleaned transcript appears below. Location recorded: Teahupo’o, Tahiti.
When you take a look at selling your business, one of the things to think about is, how good is the deal and how prepared are you, because that is going to make a difference on your grade structure. So when you are taking a look, how do you grade how well your deal is put together, what your options are, and how to get that A-Plus deal on the max multiple? This is a fantastic question. I am Scott Sylvan Bell, coming to you live from Tahiti on a perfect day to talk about business growth, business selling, and a grade scale, and a fantastic day to talk about you. Let me start by saying ia ora na.
Grading your business on a scale of A-Plus through D works like this. What you are going to do is start with your Titans thesis, your seller’s thesis but on steroids. What that is going to look like is you are going to build out all the information that you believe is going to be asked for when you are doing a deal. Some of this is going to go in a data room. Some of this is going to go in a book. But prior to you selling — five years, four years, three years, two years out — you are doing research and you are maintaining information. You are looking at multiples of where your industry is. You are looking at if the industry is growing or shrinking. You are looking to see, hey, I want to get the perfect timing. So part of this is going to come down to timing on your part. It is not just going to be about any part of the structure of the deal. Did we get in in the time zone that we needed to?
When you are taking a look, you are keeping track. In this you are going to have your standard operating procedures, your org charts, your job descriptions, your quality of earnings reports. You are going to have clean financials — clean financials, and that should happen with quality of earnings, but just to validate. Then what you are going to do is build out a presentation as if you are going to present your company to a buyer.
If you can go through and check off all the top items, and you have done opposition research on your competition, and you know where you stack up in the market — you have got Net Promoter Scores, you have got Employee Promoter Scores, you understand your referral process, you understand your recurring revenue process — all these things are going toward an A-Plus deal. Then as we start taking some of these elements away, and you do not have them, or they are not in place, or you did not consider doing them, then we start chipping away. An A deal might be missing a few of these, and so on.
On a scale of multiples, let me give you a standard number. If your industry expects a six to ten on an A-Plus deal, you could get 12, 13, 14, 15 — sometimes 16, 17. It depends on the buyer and what they are really looking for. I cannot make a guarantee. If you have got an A deal where it seems like everything is where it should be and you have got a good company, you could get an A, and that is going to be somewhere around a 10. A B is items missing — you are struggling with a few things, you have got some profitability issues — you are getting an eight multiple. Then we just start chipping away.
A D stands for “Don’t Do It.” It means you are not prepared. There are times where people reach out and say, hey, I want to sell my business. And I say, okay, we are going to ask some questions, we are going to do a diagnostic, we are going to go through a few things. And hands down, they are not ready to go. I have to tell them, you are not ready to do this, because if we grade this from an A-Plus to a D, you are going to get a D. You are going to get 50%. D stands for “Don’t Do It.” It is not worth it for you at this point.
If you reach out to buyers in your industry — strategic buyers, private equity, investment groups — and say, hey, what is it that you look for in an A-Plus deal? If I wanted the maximum multiple, what would need to be true? Nine out of ten of the industries will tell you. Occasionally you get somebody who is like, I am not telling you that. Okay — well, then I guess we will not do business. It is okay. There are some people who are persnickety. Persnickety is the word of the day. There are some people who are persnickety when it comes to how they do deals and what they are willing to divulge and what they are not willing to divulge.
What you need to know is, if you are shooting for that A-Plus deal — that starts five years, four years, three years, two years out, not the day of the sale. You want to give yourself enough runway. You want to give yourself enough ramp. You want to give yourself enough ability to say, hey, here is how I am going to get this deal, and here is what I am shooting for. When you have your seller’s thesis and you are having these conversations, you can judge and grade — okay, well, what meets my criteria for the seller? Do I have a seller’s criteria? That is your Titans thesis. That is the reason why you build this out and say, here is what my expectations are, here is what I want to do, here is what I am trying to achieve.
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