The buy-side Quality of Earnings team is insisting on a downward adjustment to our historical EBITDA because of our transition from a traditional sales team to an AI-driven automated inbound pipeline, claiming our historical numbers are not representative of future costs. How do we defend our lean marketing spend and prove this is a permanent structural margin improvement?

Question

Tyler Smith · Accepted Answer

The buy-side Quality of Earnings team will always look for ways to normalize your historical numbers by adding back costs they claim you avoided artificially. If you have replaced a traditional, expensive human sales team with an AI-powered inbound pipeline, they may argue that your low marketing spend is unsustainable and try to adjust your EBITDA downward to reflect standard industry customer acquisition costs.

To defend your numbers, you must prove that your AI-powered system is a permanent operational asset, not a temporary shortcut. Use the IVS 105 Income Approach to demonstrate the direct, repeatable margin expansion generated by your automated pipeline. You must show that your customer acquisition cost is stable and that your automated processes have run consistently for multiple quarters.

Provide the QofE auditors with clear, data-driven evidence of your operational efficiency:
- Detailed documentation of your automated workflow and the exact software tools powering your inbound pipeline.
- Historical customer lifetime value and acquisition cost data proving the efficiency is systemic, not a fluke.
- Your V/TO, which outlines your long-term marketing strategy and confirms you have no plans to return to a high-overhead sales model.

By presenting your automated operations as a core structural strength, you can reframe their attempted adjustment. You are not running an under-resourced business; you are running a modern, high-margin, automated enterprise.