"If you want to maximize enterprise value, stop obsessing over spreadsheets. Build culture. Deepen your bench. Diversify your customers."
Adam Kreek
Founder Built for Hard
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The Intangible Value Ladder: 10 Hidden Drivers That Maximize Enterprise Value
posted in Business Coaching
Adam Kreek
Most owners think valuation is just EBITDA × multiple. That’s like calling a symphony “just a bunch of notes.” Let’s look deeper.
When buyers evaluate your business, they don’t just run the numbers. They hunt for intangibles—the hidden assets that separate average companies from premium ones. In fact, research from the Exit Planning Institute (EPI) shows that up to 80% of enterprise value can be tied to these intangibles.
The problem? Most owners don’t know what they are, let alone how to build them.
That’s where the Intangible Value Ladder comes in. It’s a simple way to understand, prioritize, and climb the rungs of value creation—so you can unlock wealth when it’s time to exit.
The Intangible Value Ladder (From Foundation to Summit)
Bottom step = easiest and most important.
Top step = hardest, but delivers the biggest valuation uplift.
Enterprise Value is the outcome, not a driver.
1. Culture (Foundation)
- Shared values, trust, and a healthy workplace.
- Engaged employees who stay, grow, and care about results.
2. Leadership & Talent Bench
- A management team beyond the founder.
- Succession planning and leadership depth that de-risk the business.
3. Systems, Processes & Intellectual Property
- Documented SOPs, repeatable playbooks, and automation.
- Proprietary tech, data, or IP that competitors can’t easily steal.
4. Customer Capital (Loyalty, Retention, Contracts)
- Long-term contracts, subscriptions, or recurring revenue streams.
- Strong retention, low churn, and customer satisfaction that drives referrals.
5. Customer Diversification
- No single customer controls more than 10–15% of revenue.
- A broad, balanced portfolio of clients across industries, geographies, and segments.
6. Product / Service Differentiation
- A clear value proposition that sets you apart.
- Innovations and features buyers can’t copy overnight.
7. Channels, Networks & Relationships (Goodwill)
- Strategic alliances, distribution partners, and industry credibility.
- Supplier trust and referral networks that accelerate growth.
8. Brand Recognition & Reputation
- A respected name in the market.
- Reputation and credibility that shorten sales cycles and protect margins.
9. Owner IndependencE
- The business runs without the founder in every meeting, pitch, or approval.
- Buyers see a company, not a person.
10. Social License & Community Support (Context-Specific)
- Critical in regulated or public-facing industries.
- Community trust and regulatory goodwill that reduce operational risk.
Enterprise Value (The Summit)
When the rungs above are strong, you realize enterprise value: higher multiples, better deal terms, and freedom to choose when and how you exit.
Why This Ladder Matters
The Propel Your Business (PYB) evaluation measures what we like to call the Big 6 operational categories—Financials, Sales, Marketing, Leadership, Talent, and Productivity. That’s the engine.
The Intangible Value Ladder shows the hidden levers inside those categories that buyers actually pay for. Think of it this way:
- The Big 6 = how well you’re running the business.
- The Intangibles = how well you’re positioning the business for transfer.
Climb the ladder, and you de-risk your business, boost your multiple, and create real options for your future.
How Intangibles Fit the Big 6
Most intangibles map directly inside the Big 6 categories. They aren’t a separate, adjacent model — they are the non-financial drivers inside each blade. For example:
- Culture → fits within Leadership and Recruiting/Talent.
- Leadership & Talent Bench → Leadership and Recruiting/Talent.
- Systems & IP → Productivity (SOPs, automation, processes).
- Customer Capital (loyalty, contracts) → Sales and Marketing.
- Customer Diversification → Sales.
- Differentiation → Marketing.
- Channels & Networks → Sales and Marketing.
- Brand → Marketing.
- Owner Independence → Leadership and Productivity.
- Social License → cross-cutting, but best aligned with Leadership (values, governance) and Marketing (community reputation).
- Scalability → Financials (unit economics, margins) + Productivity (systems).
How to Use the Intangible Value Ladder
- Baseline: Score yourself on each rung (1 = weak, 5 = strong).
- Prioritize: Focus on the two lowest scores in the highest-impact categories (owner independence, customer capital, diversification).
- Act: Implement 90-day sprints—quick wins, system fixes, and team moves.
- Repeat: Re-score quarterly and track valuation lift over time.
Final Word
If you want to maximize enterprise value, stop obsessing over spreadsheets. Build culture. Deepen your bench. Diversify your customers. And—most importantly—get yourself out of the hub-and-spoke trap.
Because buyers don’t just buy numbers. They buy confidence.
Enterprise value isn’t a formula—it’s a ladder. And the climb starts now.
Read more about building value in your business here.
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Adam Kreek and his team are on a mission to positively impact organizational cultures and leaders who make things happen.
He authored the bestselling business book, The Responsibility Ethic: 12 Strategies Exceptional People Use to Do the Work and Make Success Happen.
Want to increase your leadership achievement? Learn more about Kreek’s coaching here.
Want to book a keynote that leaves a lasting impact? Learn more about Kreek’s live event service here.