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Your Company Vitality Index

Tracking and improving this metric will increase your company worth

When you look to sell your company one day, a basic question from the acquirer will be what percentage of your annual revenue generally comes from existing customers or clients versus new ones?

This metric of new customers buying from your company is called the Vitality Index. It’s simply a monthly tracker of how many new customers are jumping on board your company train. Every industry is different but on average you’ll hear the number of 10 to 15% as an index number. Certainly if you’re a new business in general then of course this number will be higher. But for a more mature business, this range is typical. Meaning, each year we look to generate 10-15% of that year’s revenues from customers that have never purchased from us before. This shows three things. It shows our sales team knows how to prospect for new business, which is a great muscle to have versus just being order takers and living off the annuity of past customers someone else reeled in. It could show that you serve a large market so plenty of new opportunities to pursue. And it shows that the market you’re serving still sees your company having something they want, so your company offering remains very relevant.

Where the index may take on some uniqueness for your particular business is you may decide to add revenues in this number that are from existing customers who have added new products/services that you offer. Meaning, they’ve been a customer but they will now be purchasing an additional product/service from you. It’s ok to include this in your Vitality Index. And some companies will extend the length of time that a new customer is part of this new customer index. One of my businesses, we considered it a new customer for 24 months given the long sales gestation cycle we had in an industry notorious for taking more than a year to onboard a customer. So there is logic to giving your business credit for more than just 12 months. You get to decide how best to define the Vitality Index for your company.

The bottom line here is what is the revenue vitality of your business? The more you can show an acquirer one day that the market still very much wants your product/service and that your sales team has a large market to go searching for new customers, the more this will build the worth of your company in the acquirer’s eyes. Start today by taking the simple step of tracking your Vitality Index and let the strategic dialog with your team flow from there because this metric will facilitate very healthy internal dialog.

Use Greenpoint Testing to Achieve Your Desired Exit Valuation

It only takes 106 questions, scanning 10 essential business functions, to stress test your readiness for a successful exit.

However, these questions require thoughtful commitment to achieve your desired exit valuation.

During this up to hour-long online testing, you'll see questions such as the following.

Sample Question 02

After internalizing each question, select among three answer options – Agree, Unsure and Don’t Agree – choosing the answer which best describes you and your business.

Then, complete the Greenpoint questionnaire to unlock your personalized report, which will reveal any gaps in your planning, pointing to the action steps needed to maximize your desired exit valuation.

Format: Digital

Delivery method: Email

Report included: Your Greenpoint results

Stethoscope Frees You to Work On Your Business, Beyond In It

120 questions, scanning 10 essential business functions, free you to work ON your business, rather than solely IN your business.

With each question requiring thoughtful commitment to identify opportunities to further your success.

During this up to hour-long digital Q&A, you'll see questions such as the following:

Sample Question 02

After internalizing each question, select among three answer options – Agree, Unsure and Don’t Agree – choosing the answer which best describes you and your business.

Complete the Stethoscope questionnaire to unlock your personalized report, which will expose gaps [if any] in your planning, and tips for future growth, resulting in action steps needed to maximize your thinking as a business leader.

Format: Digital

Delivery method: Email

Report included: Your Stethoscope results

Be Ready for The Probe of Due Diligence

109 questions, scanning 10 essential due diligence disciplines, to prepare for a roadblock free Probe of your business in anticipation of sale.

And to potentially increase the value of your business by your professional transparency.

With each question requiring thoughtful commitment to identify opportunities to further your success.

During this up to hour-long digital Q&A, you'll see questions such as the following:

Sample Question 02

After internalizing each question, select among three answer options – Agree, Unsure and Don’t Agree – choosing the answer which best describes you and your business.

Complete the Probe Diagnostic Tool questionnaire to unlock your personalized report, which will expose gaps [if any] in your planning for a due diligence Probe, resulting in action steps needed to maximize your readiness when diligence is due.

Format: Digital

Delivery method: Email

Report included: Your Probe results