Maren Kate Donovan
Maren Kate Donovan

Market Size

Source

Context

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Below is an approximate look at annual deal volume in the sub-$50 million revenue (lower-middle-market and Main Street) segment in the U.S.

For sub-$50 million revenue small-to-lower-middle-market businesses, annual deal volume likely sits in the $30–$100+ billion range across 5,000–15,000 transactions in the U.S. each year. Because no single data aggregator comprehensively tracks these smaller private deals, all figures are approximate. Nonetheless, they point to a large, highly fragmented market—one that’s ripe for disruption by a well-structured, tech-enabled M&A advisory model.

1. Why Exact Numbers Are Hard to Pin Down

  1. No Central Reporting

    2. Unlike public-company transactions (which must be disclosed), private deals are not consistently reported to a single database. Many transactions go unreported or are tracked piecemeal by regional brokers, industry groups, or listing sites.

  2. Overlap Between “Main Street” and “Lower Middle Market”
    • Main Street: Typically transactions below $2 million–$5 million in deal value.
    • Lower Middle Market: Often considered $5 million–$50 million in revenue (or deal size).

      • Because these definitions vary, studies may conflate or segment them differently, making apples-to-apples comparisons difficult.

  3. Broker & Platform Coverage
    • BizBuySell, BizQuest, and BusinessesForSale.com track a subset of smaller deals—often below $5 million.
    • Larger deals (above $10 million) might be tracked by PitchBook, Refinitiv, or S&P Global, but only if they’re disclosed.

No single platform encompasses all sub-$50 million deals.

2. Estimates From Industry Data

  1. BizBuySell as a Partial Indicator
    • BizBuySell annually reports 8,000 to 10,000+ small-business sales on its platform, with a median sale price in the low-to-mid six figures.
    • Total annualized volume just on that site might be a few billion dollars—but remember, that’s only a fraction of the entire sub-$50 million segment, since many brokers/owners do not list there.
  2. IBBA (International Business Brokers Association) & M&A Source
    • Their Market Pulse surveys typically indicate the majority of business sales occur in the under $5 million range by number of transactions.
    • When you include the lower-middle-market bracket (roughly $5 million–$50 million in revenue), the total count of deals grows significantly, and average transaction sizes increase—often into the $2 million–$20+ million range.
  3. Overall Count of Private Deals
    • Various experts suggest 5,000–15,000 private business transactions under $50 million close each year in the U.S. (not just BizBuySell, but all channels combined).
    • The total transaction value for these deals could plausibly range anywhere from $30 billion to $100+ billion annually, depending on the macroeconomic climate, industry hotspots, and how many “larger” sub-$50 million deals (e.g., $20 million–$40 million range) get transacted in a given year.
  4. Share of All U.S. M&A
    • Total U.S. M&A volume (across all deal sizes) can exceed $1–$2 trillion in a strong year.
    • Sub-$50 million deals account for a large portion of total deal count but a much smaller slice of total deal value—often single-digit or low double-digit percentages of total U.S. M&A dollars.

3. Putting It All Together

  • Deal Count: Likely in the 5,000–15,000 range annually for companies under $50 million in revenue (depending on your sources).
  • Total Dollar Volume: Roughly $30 billion to $100+ billion per year, acknowledging huge variability by economic cycle and market conditions.
  • Average/Median Deal Size: Typically in the $1–$5 million range for Main Street, climbing into $10–$30 million for the lower middle market.

Caveats

  • Underreporting: Many smaller deals never show up in public databases or aggregators.
  • Varying Definitions: “Under $50 million in revenue” doesn’t always align with how data providers categorize deal size (some track by revenue, others by EBITDA or transaction value).

4. Implications for a Disruptor

  1. Huge Fragmentation
    • With thousands of deals happening across a fragmented broker landscape, there’s significant opportunity to aggregate, streamline, and professionalize the space.
  2. Potential Market Size
    • Even at the low end of estimates ($30 billion+ in transaction value), a platform that captures a modest share (let’s say 1–2%) could generate substantial fee revenue.
    • Because sub-$50 million deals outnumber larger transactions by volume, there’s a critical mass of smaller sellers looking for improved solutions.
  3. Data & Analytics Advantage
    • If you can standardize (and thus better expose) these transactions—using AI to match buyers and sellers, or to diagnose pre-sale readiness—there’s a first-mover or early-mover advantage to building a recognized platform or brand.
  4. Brand Visibility & Trust
    • Given the lack of a dominant brand in the sub-$50 million brokerage space, a well-executed strategy combining tech, high-touch service, and educational content could position a disruptor as the “go-to” resource for retiring owners.

Bottom Line