BizBuySell released its Q2 Insight Report a few weeks back. My takeaways:
1. Deal Activity Slowing
The market saw a ~10% decline in small business deals closed both year-on-year (YoY) and quarter-on-quarter (QoQ).
While this decline was experienced across all sectors, certain sectors were impacted more sharply than others. Aggregate manufacturing and restaurant transaction values fell 14% and 16% QoQ, respectively.
Brokers surveyed suggest this may reflect increased buyer selectivity in more vulnerable industries (e.g. more discretionary, lower margin).
2. Valuations Holding Steady
Despite headwinds, valuations in the SMB space have held remarkably steady. Between Q1 and Q2 2026, the average cashflow multiple for businesses sold held at 2.65x, while the median sale price fell negligibly from ~$350K to ~$349K.
I’ve written previously about the resilience of valuation multiples in the SMB space, and Q2 2026 suggests that this phenomenon continues.
3. Increased Pressure on Lending
A tighter credit market, more stringent SBA loan eligibility requirements, and more conservative underwriting processes are becoming a constraint on the SMB side. Note that this comes off the back of a slew of changes announced by the SBA over the past 12-18 months, and an updated SOP issued mid-August (more on this soon!)
Two implications:
- seller financing may increasingly be required to bridge funding gaps, although only 29% of owners plan to offer it despite 90% of buyers expecting it; and
- exit preparation (e.g. establishing written contracts, cleaning the books) and deal preparation (e.g. getting SBA pre-qual letters, preparing a clean dataroom) are becoming increasingly important to successful transactions.