How to Sell Your Business: Questions Owners Ask

Most sales of an established company follow five steps. First, decide what you want: a full sale, a partial sale, or a recapitalization, and how long you want to stay involved. Second, get a realistic value range based on your adjusted earnings and how buyers in your industry weigh risk. Third, prepare: clean financials, contracts in order, and a team that can run the business without you. Fourth, run a confidential process that approaches several qualified buyers rather than one. Fifth, negotiate the letter of intent, work through due diligence, and close with your attorney and CPA. An advisor runs the process so you can keep running the company.

The complete guide to selling a business

The best time is usually when three things line up: you are personally ready to exit, the business is performing well (ideally with growth over the past three to five years), and buyers in your industry are active. Most owners start planning too late. Beginning two to three years before you want to sell gives you time to strengthen the business and plan a smooth transition.

Exit planning: sell before you retire

Preparation means financial statements that tell a coherent story, documented systems and procedures that reduce dependence on you, contracts, employee records, and corporate documents in order, legal or environmental issues addressed, and a management team that can operate without you. Ideally, start two to three years before a sale. We also advise owners before they go to market.

A 12-month plan to prepare your business for sale

Take the call, but don't negotiate alone. An unsolicited approach means a buyer sees value; it doesn't tell you whether the price or terms are competitive. Before sharing financials, ask for a nondisclosure agreement, find out who the buyer is and how they would pay, and get a view of your value from someone who isn't the buyer. Often the right next step is to test the interest with other qualified buyers.

What to do when a buyer contacts you

Buyers start from your adjusted earnings, usually EBITDA with owner-specific expenses added back, and then weigh risk: how dependent the business is on you, how concentrated your customers are, how predictable your revenue is, and how active buyers are in your industry. Our valuation calculator gives a preliminary range, and a confidential conversation with our team gives you a fuller picture.

What drives M&A valuation

The factors buyers reward most are steady revenue growth, healthy margins compared with industry peers, a customer base without a single dominant account, recurring or contracted revenue, a management team that runs the business without the owner, a defensible market position, and clean, reviewed financial statements. We help owners work on these before going to market.

How to increase your business valuation

Buyers and their advisors use several approaches: comparable company analysis (comparing to similar public companies), precedent transaction analysis (looking at recent M&A deals in your industry), discounted cash flow analysis (projecting future cash flows and discounting them to present value), and asset-based valuation for asset-heavy businesses. For most middle-market transactions, an earnings-based valuation using comparable transactions is the primary method, adjusted for growth, customer concentration, and management depth.

How M&A valuation methods differ

A formal sell-side process typically takes six to twelve months from engagement to closing: about two to three months to prepare the financials and marketing materials, three to four months for buyer outreach, management meetings, and due diligence, and two to three months for negotiation and closing. Regulatory approvals, earnouts, or several competing bidders can extend the timeline.

How long it takes to sell a business

An investment banker acts as your advisor and advocate through the whole sale: preparing the marketing materials, including the confidential information memorandum; identifying and approaching qualified strategic and financial buyers; running the data room and due diligence; negotiating price, structure, and terms; and coordinating your attorney, accountant, and other advisors. The aim is a competitive process and terms that protect your interests.

What an investment banker does when you sell

We use several channels: our buyer network of strategic acquirers, private equity firms, and family offices; industry research to find competitors and adjacent companies that would benefit from your capabilities; relationships built over years of transactions; and targeted, confidential outreach to qualified prospects. Approaching several interested parties at once gives you options and negotiating leverage.

A complete data room usually includes three to five years of financial statements (ideally reviewed or audited), tax returns, customer and revenue breakdowns, an employee roster and organizational chart, key customer, supplier, and lease contracts, corporate documents, insurance policies, equipment lists, intellectual property records, and any pending litigation or environmental matters. We provide a checklist and help you organize it.

What buyers look for in due diligence

In a merger, two companies combine to form a new entity, typically with shared ownership and governance. In an acquisition, one company buys another and keeps control. Most middle-market transactions are acquisitions, where a buyer purchases the company's stock or its assets. The structure affects tax treatment, which liabilities transfer, and how employees move over.

Fee structures vary from firm to firm, so ask any advisor how theirs works. Our fees depend on the engagement, and we walk through them in the first conversation.

Seller financing means you lend the buyer part of the purchase price. It isn't always necessary, but it can widen your pool of buyers and show confidence in the business. Seller notes are usually subordinated to bank debt and may include collateral, and the terms vary by deal. We help structure terms that protect your interests.

Seller financing in M&A

It's the normal level of working capital (receivables plus inventory, minus payables) that the buyer expects the business to deliver at closing. If working capital at closing comes in above the peg, the price usually goes up by the difference; if it comes in below, the price goes down. The peg is negotiated from your historical monthly averages, so it pays to understand your own seasonality before you sign a letter of intent.

How the working capital peg works

Tax treatment depends on the deal structure (stock or asset sale), your entity type, your state, and your personal situation. Sellers often prefer stock sales and buyers often prefer asset sales, and long-term capital gains rates usually apply to assets held more than a year. Installment sales, qualified small business stock rules, and charitable planning can change the result. We plan the structure with your tax advisors.

A tax-smart approach to selling a business

It depends on the buyer and the deal structure. Strategic acquirers often keep key employees to protect operations and customer relationships, and private equity buyers typically invest in the management team and may offer equity incentives. During negotiations we push for employee protections and transition plans that fit your priorities, and many owners weigh how a buyer will treat long-time employees when they choose the buyer.

We work with owners of industrial and blue-collar businesses: aggregates and quarries, paving, construction, steel fabrication, crane and hoisting, equipment rental, HVAC and mechanical contractors, infrastructure contractors, oilfield services, manufacturing, and agriculture. Our team has operating experience in these sectors, so we speak the language of both sellers and the buyers who specialize in them.

• Aggregates
• Paving
• Construction
• Steel fabrication
• Crane and hoisting
• Equipment rental
• HVAC and mechanical
• Infrastructure contractors
• Oilfield services
• Manufacturing
• Agriculture

We work with owners anywhere in the United States, and we have done work in Canada. We are headquartered in Oklahoma City with an office in Dallas, and we go wherever our clients are.

• M&A advisory in Oklahoma
• M&A advisory in Texas

We focus on established, founder-owned and family-owned middle-market companies: businesses that have outgrown a business broker but are often overlooked by large Wall Street banks. Our clients are usually exploring a sale, a recapitalization, or growth capital. If you're not sure you're a fit, a confidential conversation will tell you quickly.

Start with a confidential conversation about your goals, timeline, and business. The first consultation is free: we discuss your objectives, share an initial view of the market, and explain our process. If we're a good fit, we propose a formal engagement with a valuation analysis and a go-to-market plan. There's no obligation.

Contact our team