Did you know a business could be profitable but not valuable? Let me give you an example. Suppose a business is doing 3 million in profitable sales with a margin of 60%. Yet, the customer is one government contract. This means the customer base is not diverse and breaks rule 4. (“14 Immutable Laws of Business Value, Rule 4, pg 18). As you know, a slight offense to the government official that extended the contract could end the contract. So, this business would not a get a full 3 X EBITADA valuation.