Business Brokerage Break-Even Revenue: About $49K/Month

Fixed costs $32.3K/mo Y1 base burn

Contribution margin 71% After variable costs

Break-even revenue $45.5K/mo Revenue needed monthly

Break-even timing Month 22 Model crossover point

Break-even calculator

Test monthly revenue, variable expenses, and fixed costs against break-even.

Lean Base Full

Monthly revenue Revenue is the cash coming in before direct costs and overhead. $ Lower sales Higher sales Variable expenses These are direct costs that rise with each deal, like commissions and deal marketing. $ Lower costs Higher costs

Money available to cover fixed costs $38,000 $50,000 revenue - $12,000 variable expenses

Margin ratio

76%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base that contribution margin must cover. $ Lean setup Heavier setup

Break-even chart Revenue Total costs

Which expenses stay fixed and which move with sales in a business brokerage break-even model?

Cost classification

Break-even gets more reliable when fixed overhead is kept separate from revenue-linked fees. Here’s the quick rule: rent and retainers set the monthly hurdle, while commissions and deal support move with closed revenue.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent	Fixed	Include $3,500 per month in the baseline overhead before calculating required revenue.	Do not tie rent to deal volume.
Professional Insurance (E&O)	Fixed	Include $500 per month as required coverage across the full planning range.	Do not treat required coverage as optional per deal.
CRM & Data Subscriptions	Fixed	Include $800 per month as core operating infrastructure.	Do not bury core systems in variable spend.
Legal & Accounting Retainer	Fixed	Include $1,000 per month as recurring support for the firm.	Do not mix the retainer with deal-specific legal work.
Advisor Commissions	Variable	Model as 20% of revenue in the first year, falling to 16% by the mature year.	Do not include salaried staff here.
Deal-Specific Marketing & Lead Generation	Variable	Model as 4% of revenue in the first year, separate from the annual marketing budget.	Do not combine it with the $30,000 first-year marketing budget.
Third-Party Due Diligence Tools	Variable	Model as 3% of revenue in the first year because usage rises with transaction work.	Do not treat usage-based tools as fixed overhead.
Marketing & Admin Coordinator Payroll	Semi-fixed	Model in staffing steps as full-time equivalent headcount rises from 0.5 to 1.0.	Do not spread payroll as a percent of every closed deal.

How does break-even change from a lean launch to a base team and then a full-service brokerage?

Scenario table

As the team scales, variable costs fall from 29% to 21%, but fixed overhead rises from $348k to $636k. So break-even revenue still climbs, even with a stronger contribution margin, meaning more revenue stays after variable costs.

Planning cases only; actual break-even will move with deal flow, close timing, and staffing mix.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean launch	$490k	$142k	$348k	71%	$0	Tight cushion; a small miss can turn losses on fast.
Base scaled team	$703k	$176k	$527k	75%	$0	Better margin, but steady closes are still required.
Full-service mature setup	$805k	$169k	$636k	79%	$0	Best cushion, but only with deep, consistent deal flow.

What pushes a business brokerage past break-even?

Stress test

Break-even gets fragile fast if closings slow, Year 1 CAC stays above $3,000, or payroll gets ahead of the pipeline. That’s when cash burn can move toward the $405k minimum in Month 25.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change; fixed costs hold at $348k and margin stays at 71%.	$491k	$0 gap	Base case clears only if closings stay on pace.
Revenue shortfall	Monthly revenue slips to $40k, or $480k a year.	$491k	$64k gap	Fewer closings leave too little contribution to cover overhead.
Fixed-cost pressure	Overhead rises 10% to $383k.	$539k	$48k gap	Payroll and overhead move up faster than deal flow.
Margin pressure	Variable expense pressure cuts margin from 71% to 66%.	$528k	$37k gap	A 5-point margin drop pushes break-even later.
Combined pressure	Margin falls to 66% and overhead rises to $383k.	$580k	$89k gap	Slow closings plus heavier cost load strain cash fast.

What should the founder verify before signing the lease and hiring for this business brokerage?

Founder checklist

Don’t lock in the lease, payroll, or marketing until you can show real seller and buyer referrals, the CRM is live, and the cash plan covers the first two loss years. With Year 1 EBITDA at -$321K, Year 2 at -$86K, and minimum cash of $405K, break-even only works if the pipeline is real.

1Referral Flow$3.5K/mo

Validate a steady seller and buyer referral flow before you sign the $3,500 monthly lease, because fixed rent hurts fast when the pipeline is thin.

2ComplianceMonth 1

Confirm licensing and client-work compliance before taking a case, so launch delays do not stack on top of payroll and rent.

3CRM Live$3,000 CAC

Set up the CRM before paid lead spend, or the Year 1 customer acquisition cost target is just a guess instead of a tracked funnel.

4Margin Mix71% CM

Check that contribution margin stays near 71% in Year 1 after commissions, due diligence tools, closing support, and deal marketing, or break-even slips.

5Staffing RampMonth 37

Delay the junior advisor hire until workload proves it, since the model does not add that role until Month 37.

6Cash Cushion$405K

Keep at least $405,000 in cash, because Year 1 EBITDA is -$321,000 and Year 2 is -$86,000 before the business reaches payback.