Tobias: Consulting Companies Sell at 3x to 5x EBITDA
Martin Tobias · #116 Kimoyo: Is This African Startup Venture Backable? · Mar 4, 2025 · at 19:00
Investor Martin Tobias discusses Kimoyo Insights' business model and how service-based businesses are valued compared to SaaS companies.
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“Consulting companies sell at three or one X revenue, maybe three or five X EBITDA.”
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More from Martin Tobias
Tobias: Kimoyo Insights Is a People Business, Passing on Investment
“This is not, this is a people business where you're basically renting people, and for that reason, it doesn't fit my thesis and I'm out.”
Tobias Predicts Kimoyo Insights Will Exit for Mid-Double-Digit Millions
“I don't think it ends up being a billion dollar exit, or even a hundred million dollar exit. I think it ends up being a maybe mid-double digits exit.”
Tobias: Kimoyo is a 'people renting' business, not software
“This is not, this is a people business where you're basically renting people. And for that reason, it doesn't fit my thesis and I'm out.”
Tobias: Startups in foreign countries backed only by US VCs raise concerns
“I get a little concerned when I see only US VCs in an, in a foreign country.”
Tobias predicts Kimoyo will exit for mid-double-digit millions, not $100M+
“I don't think it ends up being a billion dollar exit, or even a hundred million dollar exit. I think it ends up being a maybe mid double digits exit.”
Enterprise demo deals fail when nobody owns end-user acquisition
“I know you're, you say that they're responsible for it, but I've seen these kind of things where, you know, you sign a demo deal and then nobody's really responsible for customer acquisition, and at the end of the LOI, everybody's like, this thing didn't work.”