Twenty-four questions on how your business reads to a lender, a board, or a buyer.
Every business gets examined eventually. A credit renewal, a board cycle, a raise, a buyer at the door. The person doing the examining reads the business differently than the person running it does, and the gap between those two readings is what sets the terms.
This walks the six dimensions that gap usually sits in. You answer, you see how a lender or a buyer reads that answer, and at the end you get a composite score, the two dimensions where the highest-leverage work sits, and what closing them involves.
You do not need a finance background to do this. If a term is unfamiliar, the tool explains it as you go.
It is not anonymous. Your responses are handled under our Privacy Policy. If the read surfaces something worth a conversation, someone from TEOL may follow up. If you choose not to engage, you may receive occasional insights from TEOL. Every message includes a one-click unsubscribe.
Fifteen to twenty minutes. You can go back at any point.
Before you begin
It means the finance function around the business would stand up to examination by a lender, a board or a buyer without you having to explain it. The business itself may be excellent either way. Readiness is about whether the numbers, the reporting and the structure are documented well enough that someone outside can verify them quickly.
Cash flow, and whether they can verify it. A credit committee starts with how much cash the business reliably produces and how much of that is evidenced rather than asserted. Everything else in the terms follows from what they decide there.
A practical test: pick any number in your monthly reporting and ask how quickly someone could show what sits behind it. If the answer involves rebuilding it by hand, a buyer will find that out during diligence and price it.
It is an exercise where an accounting firm rebuilds your profit figure from source records rather than accepting your reported number. Buyers commission them routinely. Sellers sometimes commission their own first, so the conversation starts from a figure they have already defended.
It depends where you are starting. Moving from informal reporting to something a lender or buyer accepts is usually a matter of months rather than weeks, and the work is mostly documentation rather than changing how the business runs.
Add-backs are costs taken back out of profit because they are personal, one-off, or would not continue under new ownership. Buyers challenge them because each one increases the profit figure they are paying a multiple of. An add-back with written reasoning behind it is far harder to argue with than one raised in a meeting.
Yes, and it is one of the more reliable discounts. If key relationships, pricing decisions and institutional knowledge sit with one person, a buyer is pricing the risk that those leave with them. The fix is mostly documentation and delegation rather than hiring.
A few of the questions and inputs you will see. Your answers and results stay in the diagnostic.
Use the Institutional Readiness Index to make a directional read of your business. This is not a lender quote, valuation opinion or commissioned diligence report.
Provide your details and work through 24 questions across six areas. Allow about 20 minutes; your pace may vary.
Choose the answer that describes your current position. The commentary explains how a lender, board or buyer could read your answers in the section summaries and final read.
Read dimension scores and a composite score. The output is indicative, not a formal quote or verified diligence opinion.
Review the recommended actions where gaps qualify. If no areas need remediation, maintain the evidence and revisit the read when your circumstances change.
Choose the next question you want to examine:
The Institutional Readiness Index applies TEOL Capital's flagship six-dimension framework to produce a composite institutional readiness score. The framework measures the dimensions institutional capital partners actually weigh into pricing, structure, and terms across every capital event.
Financial Truth measures the defensibility of reported EBITDA under quality of earnings examination. Anchored to the Financial Truth Ladder, the dimension assesses position from cash-basis approximation (Rung 1) to audited statements with QofE overlay (Rung 5).
Reporting Integrity measures the institutional quality of management reporting beyond financial statements. Anchored to the Reporting Under Scrutiny Model, the dimension examines monthly close discipline, variance analysis cadence, segment integrity, and management reporting defensibility.
Cash Visibility measures treasury maturity from reactive bank-balance position to scenario-capable institutional treasury. Anchored to the Cash Visibility Maturity Model across five stages.
Operator Dependency measures concentration of decisions, cash control, external relationships, institutional knowledge, hiring authority, and reporting through the operator. Anchored to the Founder Dependency Index across six axes.
Structural Architecture measures entity structure integrity, intercompany discipline, capital allocation framework, and consolidation methodology. Anchored to the HoldCo Finance Architecture for multi-entity operators.
Capital Readiness measures composite preparedness for the specific capital event under examination. Anchored to the Capital Readiness Scorecard.
Each dimension is scored 0 to 100 based on responses to four questions per dimension (24 questions total). Scores are weighted equally and aggregated into a composite read with the following band placement:
The composite and dimension scores are a directional assessment of your finance function, not a prediction of loan pricing, sale multiples or investor returns. The result identifies areas below the readiness threshold and actions you can use to address them. If none falls below it, the recommendations focus on maintaining your evidence.
Your answers are self-reported and have not been verified against your records. This is a directional read, not a commissioned diligence, credit or valuation opinion.
Sector multiples, adjustment ranges and stress factors in this tool are TEOL's illustrative calibrations, based on general market observation and TEOL's frameworks. They are not drawn from a single dataset and do not predict any specific outcome.