As a Houston-based business owner, you will undoubtedly be proud of the city’s robust economy, diverse population and unparalleled resilience. The impressive reputation of Houston and the growth that it has experienced, and continues to experience, makes it a highly sought-after location for expanding companies – and potentially very profitable for those interested in selling a business in Houston.
There are many factors that make The Bayou City an attractive proposition to professional buyers. Houston is the only large city in the country without zoning laws, reducing restrictions for those seeking to build and grow their company. It has a growing population – between 2010 and 2017, no large metro in the U.S. grew faster than Houston. And many, including Best Places, see Houston as the city of the future for its innovative initiatives.
So, both right now and for the foreseeable future, there is a big opportunity for those selling a company in Houston to receive a premium offer, if they have the right team behind them.
“Why Sell My Business in Houston?”
As an owner of one of the 130,000+ businesses in Houston, you recognise the advantages this vibrant landscape offers to those looking to build their company. Generational Equity is based just a few hours away in Dallas, so we’ve had a front row seat to the city’s incredible growth in the past decade.
But we’ve also witnessed the effect it’s had on business valuations in Houston. Due to the appeal the area has for cultivating businesses, the area attracts significant interest from buyers and investors alike. Below, we outline some of the reasons why this interest exists and why it could make you seriously consider the opportunity selling a company in Houston presents.
Understanding Business in Houston
The Houston metro area boasts the sixth strongest economy in the country with an enviable GDP of around $540 billion. To put this in perspective, if the area was its own country, its wealth would outrank Poland and Nigeria. Understandably, this makes Houston a thriving environment for businesses of all sizes – the metro is home to 21 Fortune 500 HQs (4th highest in the nation) and 73 of the fastest-growing businesses according to Inc. 5000.
For those interested in selling their business in Houston, these stats are a signal to buyers how successful the city can be for their ambitions. And that success isn’t limited to a single industry. While Houston for over a century has been powerful hub for oil and energy, with renowned names like Phillips 66, Halliburton and Kinder Morgan based in the area, it is also considered a leader in healthcare, manufacturing, engineering, finance and aerospace, as well as enjoying a technological revolution with over 500 digital technology companies.
When it comes to exiting your business, Houston’s diversity ensures that company owners in all industries can pursue that premium offer.
The People That Make Houston Prosper
Diversity across Houston’s business landscape is matched by diversity in the population generally.
Houston’s metro area has a population of 6.9 million, the fifth most populous in the U.S. – a number that continues to grow. This diverse population, with no single majority race or ethnicity and over 145 languages represented, is a valuable resource for business owners in the area.
And people continue to be attracted to Houston for several reasons, not least of which is the low living costs. The overall cost of living is 21% below the average among the 20 most populated metro areas, while Forbes in 2015 ranked it second among cities where pay checks stretch the furthest. This affordability, as well as the lack of income tax and other state benefits, makes the area a hotbed for entrepreneurship.
This, along with exciting prospects like the ‘Plan Downtown’ initiative and the Innovation District continue to develop the area and drive people to the city. This volume of prospective workers and consumers is a big appeal to buyers, adding further value to the opportunity of exiting a business in Houston.
Houston: Business at its Heart
As mentioned, Houston is the only major city in the U.S. that doesn’t have zoning laws for business locations. This unrestricted movement makes it an exceptional environment for investors looking to expand in the area, while also establishing a culture of entrepreneurial support, rather than competition.
Houston’s supportive setting was demonstrated in the wake of Hurricane Harvey, with many companies pledging millions to the relief effort. Houston’s business-centric attitude has helped the area be named the top-ranked metro for Economic Growth Potential by Business Facilities, which impacts all industries:
- Digital technology received over $1.8B in venture capital funding
- Foreign air cargo exceeding 187,000 tons in 2017
- Over $80B dollars of products manufactured annually
- Nearly 2.6 million barrels of crude oil processed a year
- Over 1,750 life sciences companies in the area
With such clear success across a diverse range of industries, buyers see Houston as an inviting target for acquisitions and investments. Therefore, if you’re contemplating selling your business in Houston, this significantly boosts your chances of securing a premium.