The credit crunch and economic climate has put many deals on hold.  But some deals are getting done and I've wondered what they look like.  Here's some relevent and recent data to chew on.

In a nutshell, fewer deals are getting done and those that are getting done are larger in size.  For example, the average deal size in 2007 was $9,000,000 and in late 2008 / early 2009 the average deal size was $13,500,000.  That's a whopping 50% increase.  How does that affect you?  The average EBITDA multiple for the $13.5M deals was 4.69.  Doing the math, the average EBITDA was $2,878,000.  Note that an EBITDA of $2.9M represents a very strong company.  If your EBTIDA is lower, lower the multiple to get a feel for the value of your business.

There is hope though:

It was a difficult time period for financing transactions, and many decided to wait for a better economic climate before entering or re-entering the market. We’re hopeful that the $400 billion overhang of capital that has built up in private equity groups will soon begin to assert itself in this market, and we may be seeing some early signs that this is starting to happen.

In other words, private equity firms and other outside investors have $400,000,000,000; billion with a "b" of capital looking for a good place to grow.  That capital is going to start looking for good companies to invest in - is your's one of them?  Now is the time to start positioning you and your business for a piece of that action.