I’m seeing more deals where EBITDA is carrying assumptions the business itself doesn’t support. Just had two similar conversations this week, one in Santa Monica and one on a Zoom during a walk in Beverly Hills.
In the more impactful deal, roughly 20% of costs were classified as “non-recurring.” The asset looked stronger on paper, but most of those expenses were part of normal operations. This is becoming common across mid-market deals, and it creates a gap between what’s acquired and what actually needs to be run.
That gap tends to surface quickly post-close. Targets are set against adjusted numbers, while teams are operating with real constraints, fragmented systems, and limited visibility. In the current environment, with less room for multiple expansion, that gap shifts the burden almost entirely to execution.
What holds up better is grounding decisions in operating data. Connecting go-to-market performance to revenue and cash flow, validating add-backs early, and aligning RevOps with FP&A so forecasts reflect how the business actually runs.
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LA Broadcast: The Increasing Prevalence of Aggressive EBITDA Adjustments
Mario Peshev
