What Is a Business Broker and How to Become One

What Are Business Brokers?

A business broker facilitates the sale of businesses. In this job, you act as an intermediary between the buyer and seller and oversee the details and stipulations of the sale. It is your responsibility to ensure a smooth transaction of ownership between businesses, and other duties may include negotiating sale prices, appraising the overall worth of a business, running advertisements of the sale, and interviewing prospective buyers

How to Become a Business Broker

To become a business broker, you need a bachelor’s degree in accounting or business. You may also need to earn a state license to practice as a business broker, but this requirement depends on the state where you work. Some states also require a real estate license. After earning the correct licenses, completing training seminars can help you cover the basics of the industry and increase your chances of securing employment. Joining the International Business Brokers Association (IBBA) can provide resources for reputable courses and offer insight into successful broker careers. You should also consider earning a valuation analyst certification from the National Association of Certified Valuators and Analysts (NACVA) to boost your credentials.

How Do Business Brokers Get Paid?

Business brokers typically earn commissions from completed sales that they facilitate. In addition to their commision, they may also work for an hourly rate or have a retainer fee. Depending on the brokerage and contract between the broker and client, these payments may be payment installments or lump sums. For example, payment may consist of a combination of an upfront retainer for expenses used in the sale, along with a commission at the completion of the sale. Commissions can average between 5% to 12%, but this is also dependent on the client and size of the business.