REPLAY: How to Build a More Valuable Home Care Business with Alex Veach — Augusta Webinars
How to Build a More Valuable Home Care Business
Augusta Webinar with Alex Veach (Agenda Health)
Whether you’re planning to sell or simply build a stronger business, the decisions you make today directly impact your agency’s future value. Alex Veach, Partner at healthcare M&A advisory firm Agenda Health, shares the operational, financial, and strategic factors that consistently lead to stronger valuations and better outcomes for home care agency owners. You’ll leave the webinar with practical ideas to increase your business’s value—whether your goal is growth, succession, or an eventual sale.
Here are the main learnings:
The Home Care M&A Market Remains Active
Despite challenges around staffing and uncertainty surrounding Medicaid, Alex shared that buyer interest in home care remains strong.
One major reason is simple: demand for home care continues to grow as the U.S. population ages. Investors recognize the long-term need for home-based services and continue to deploy capital into the industry.
Those buyers can take several different forms, including:
- Private equity-backed home care platforms
- Strategic home care operators
- Regional and family-owned organizations
- Family offices and other investment sponsors
Different buyers are looking for different opportunities. Some may prefer independently owned agencies, while others actively pursue franchise-backed businesses. The key is finding buyers whose investment criteria align with the agency, its market, and the owner’s goals.
What Makes a Home Care Agency More Valuable?
Revenue and profitability matter, but buyers evaluate much more than what appears on an income statement.
According to Alex, several characteristics can help make a home care agency more attractive to potential buyers.
Clean financials. Buyers need reliable financial information that gives them confidence in the performance of the business.
Diversified referral sources. Relying heavily on a single referral partner introduces risk. A broader referral network can make future revenue appear more sustainable.
Owner-independent operations. An agency becomes more difficult to acquire when the owner personally handles everything from billing to marketing. Buyers want to see a capable team with clear roles that can continue operating after the owner exits.
Organized systems and documentation. Contracts, employment agreements, financial records, processes, and other important information should be documented and easily accessible.
Continued growth potential. Buyers aren’t only investing in what an agency is today. They’re investing in what it can become.
As Alex explained during the webinar, the goal is ultimately to tell the story of where the business has been, where it is now, and where a buyer can take it next.
Caregiver Recruiting and Retention Can Directly Impact Agency Value
Caregiver retention isn’t only an HR metric—it can become an important part of a home care agency’s valuation story.
When a buyer acquires an agency, one of the biggest questions is whether the business will continue performing after the transaction. A stable caregiver workforce can provide greater confidence in that continuity.
That makes it important for agencies to have a clear retention story: What are you doing to keep caregivers? What incentives and processes are in place? How effective is your onboarding? Can you consistently recruit enough caregivers to support future growth?
The webinar highlighted that nearly four out of five caregiver exits happen within the first 100 days, making onboarding and early retention particularly important.
Recruiting capacity matters, too. An agency that has demand for new clients but cannot staff them has a natural ceiling on growth.
That’s why recruiting for retention is so important. As Jen pointed out, the connection between recruiting and retention can be very practical. If a caregiver wants 30 hours of work each week but is consistently offered only 20, for example, turnover becomes much more likely.
Hiring caregivers whose needs align with what the agency can actually offer can help improve retention—and ultimately support sustainable growth.
Don’t Wait Until You’re Ready to Sell to Start Preparing
One of the clearest messages from the webinar was that preparing to sell a home care agency should begin well before the owner wants to exit.
Alex recommended that owners begin seriously preparing around 24 months before a potential sale. That can include strengthening the management team, improving financial reporting, documenting systems, and investing in caregiver retention.
Around 12 months out, owners can begin narrowing their timeline, identifying remaining value-creation opportunities, and considering which third-party advisors they’ll need.
By six months out, assembling the deal team and organizing the information buyers will request becomes especially important.
But owners don’t need to have a sale date in mind to start thinking about valuation. Understanding what your agency is worth—and what could increase or decrease that value—can help you make better decisions long before an exit.
How Are Home Care Agencies Valued?
One of the most common questions agency owners have is: What multiple could my home care agency sell for?
According to Alex, home care transactions are commonly valued based on a multiple of adjusted EBITDA, with the multiple generally increasing as agencies become larger, more profitable, and more sophisticated.
Agenda Health has seen smaller opportunities transact around 4–5x adjusted EBITDA, while highly scaled, multi-state or multi-market agencies with strong teams, growth, and other attractive characteristics can reach approximately 9–11x adjusted EBITDA.
There is no universal multiple, however. Payer mix, agency size, profitability, growth, caregiver retention, management depth, referral diversity, geography, and other factors can all influence valuation.
That’s why simply hearing that another home care agency sold for a certain multiple doesn’t necessarily tell an owner what their own business is worth.
Growth Matters—But So Does Leaving Room for the Next Owner
Agency owners sometimes assume they should grow as much as possible and sell only when they’ve exhausted every opportunity.
That can actually make the business less compelling.
Buyers want to see a successful operation, but they also want to understand how they can continue growing it. An agency that appears to have reached its ceiling—or has already begun trending downward—can be a harder investment story.
Instead, owners should continue pursuing meaningful growth while being able to demonstrate additional opportunities a future buyer could capture.
That could include expansion into new markets, additional client capacity, stronger caregiver recruiting, or other untapped opportunities.
The Big Takeaway for Home Care Leaders
The best time to think about the value of your home care agency isn’t when you receive an offer. It’s while you still have time to influence that value.
Clean financials, diversified referrals, strong management, documented systems, healthy margins, caregiver retention, recruiting capacity, and continued growth potential can all make an agency more attractive to buyers.
And many of those same factors also make for a stronger business today—even if selling is still years away.
As Alex summarized during the webinar: “The best time to prepare was three years ago. The second best time is this quarter.”
For home care leaders, preparing for maximum value ultimately means building an agency that can thrive without depending on one owner, one referral source, or one person to hold everything together. Build that foundation now, and when the time eventually comes to sell, you’ll be in a much stronger position to tell a compelling story about what you’ve built—and where it can go next.
FAQ
How are home care agencies valued?
Home care agencies are commonly valued using a multiple of adjusted EBITDA, or earnings before interest, taxes, depreciation, and amortization, with certain adjustments made to reflect the underlying profitability of the business.
According to Alex Veach, Agenda Health has seen smaller home care businesses transact around 4–5x adjusted EBITDA, while larger, sophisticated multi-state or multi-market agencies with strong growth and management teams can reach approximately 9–11x adjusted EBITDA.
There is no single valuation multiple that applies to every home care agency. Agency size, profitability, payer mix, growth, geography, caregiver retention, management depth, referral diversity, and other factors can affect valuation.
When should I start preparing to sell my home care agency?
Ideally, owners should begin preparing well before they intend to sell. During the webinar, Alex recommended beginning serious preparation approximately 24 months before a potential transaction.
This gives owners time to strengthen financial reporting, improve operations, build their management team, document processes, address caregiver retention, and identify other opportunities to increase the agency’s value.
Even if you aren't planning to sell soon, understanding your agency’s value can help you make better long-term business decisions.
Does caregiver retention affect home care agency valuation?
Yes. Caregiver retention can influence how buyers evaluate the stability and future growth potential of a home care agency.
A stable caregiver workforce gives buyers greater confidence that the agency can continue serving existing clients and take on new ones. High turnover, on the other hand, can make sustainable growth more difficult.
During the webinar, Jen and Alex discussed the importance of having a clear retention story that explains how the agency recruits, onboards, engages, and retains caregivers.
How does caregiver recruiting affect the value of a home care agency?
Caregiver recruiting directly affects an agency’s ability to grow. The webinar highlighted that nearly four out of five caregiver exits occur within the first 100 days.
An agency may have strong demand from prospective clients, but if it cannot recruit enough caregivers to provide that care, growth becomes limited. Buyers therefore want to understand whether an agency has a repeatable recruiting process that can support its future client pipeline.
Improving early caregiver retention can help create a more stable workforce and support sustainable agency growth.
Should I keep growing my home care agency before selling it?
Yes, but buyers also want to see opportunities for future growth.
A strong acquisition candidate can demonstrate both a history of successful growth and a clear path for the next owner to continue that growth. Potential opportunities might include expanding into new markets, increasing caregiver capacity, strengthening referral relationships, or serving additional clients.
An agency that has already exhausted every growth opportunity—or has started declining—may present a less compelling investment story.
Do I need to be ready to sell before getting my home care agency valued?
No. Understanding your agency’s value can be useful even if a sale is years away.
An early valuation can help identify factors that are strengthening or limiting the business’s value. Owners can then use that information to prioritize improvements while they still have time to make a meaningful impact.
What can home care agency owners do now to increase business value?
Focus on building a business that is sustainable, scalable, and less dependent on any single person or source of business.
That means maintaining clean financials, strengthening profitability, developing the management team, diversifying referrals, documenting processes, improving caregiver recruiting and retention, and continuing to create opportunities for future growth.
As Alex put it during the webinar: “The best time to prepare was three years ago. The second best time is this quarter.”
About the Speakers
Alex Veach
Partner, Agenda Health
Alex is a Partner at Agenda Health, where he helps lead the firm’s strategic growth, advisor development, and client relationships across the healthcare sector. Since joining in 2017, Alex has executed on hundreds of successful transactions and played a key role in building the firm’s platform. Alex continues to advise on healthcare transactions and leads the firm’s valuation practice, delivering the insights needed to facilitate successful outcomes for business owners. He works closely with both buyers and sellers, bringing a pragmatic, execution-focused approach to every engagement.
With a background in finance and a focus on client-centered service, Alex is committed to helping healthcare organizations achieve outcomes that align with their long-term goals.
Alex lives in Austin, Texas with his wife and son. Outside of work, he enjoys spending time outdoors, traveling, and exploring Austin’s food scene.
Jen Waldron
Co-Founder, Augusta
I began my career as a caregiver and personally experienced “pulling a double.” This gave me firsthand insight into the challenges and opportunities for senior care.
I went on to scale some of the industry’s most impactful companies—helping grow IPCed and OnCourse Learnings’ post-acute care division to $10M+ ARR (acquired later by Relias). And, drove CareAcademy’s revenue from six figures to multi-millions as SVP of Sales and Business Development.
Now, as a co-founder of Augusta, I am tackling one of the biggest challenges in home care: caregiver recruitment. Augusta helps agencies find and interview top-tier caregivers to fuel business growth.
I’m passionate about data-driven solutions that transform caregiver hiring and retention, delivering measurable business results for home care agencies.
