Thinking about selling your business in the next few years? The most successful exits don’t happen by accident; they’re the result of early planning and strategic decisions. In this guide, we’ll break down five essential steps to help you maximize value, minimize stress, and prepare for a smooth and profitable sale.

1. Start Early

Exit planning isn’t something you can leave until the last minute. I tell people all the time—if you’re thinking about selling in 3-5 years, start prepping now. There are plenty of factors that can bump up your valuation, but most owners don’t even know what they are. Figure out what drives your valuation—whether it’s EBITDA, revenue, or assets. Then, focus on maximizing those. Ask yourself: How important is sales growth? Should you be hiring more in the next few years? What impact will these moves have on your valuation? The key is understanding what makes your business valuable and then doubling down on those areas.

2. Understand What Type of Transaction You Want

Not all sales are the same. Do you want to sell to a strategic buyer, a private equity firm, a search fund, or maybe go the ESOP (Employee Stock Ownership Plan) route? Each option comes with different implications for you and your business. Think about what matters most to you: Do you want to stay involved, or are you looking for a clean exit? Do you care more about your employees’ future, or is the highest price your main goal? Figuring this out early will help you target the right buyer and structure the deal to meet your needs.

3.  Know Your Business’s Value

Get a solid valuation to understand what your business is worth in today’s market. Consider your market position, customer base, and growth potential. A professional valuation gives you a good benchmark for what offers might look like. Once you’ve got the numbers, decide if you’re satisfied with what you’ll take home after taxes and fees.

   Buyers are going to dig into your financials, so make sure they’re spotless. Clean, accurate, and up-to-date records are a must. Focus on boosting profitability, cutting unnecessary expenses, and showing consistent revenue growth. The better your financials look, the more attractive your business will be to potential buyers.

5. Identify Potential Buyers Early

   Don’t wait until the last minute to start thinking about buyers. Whether it’s competitors, industry partners, private equity firms, or search funds, start identifying potential buyers well in advance. I always say, building relationships early can make the sale process much smoother when the time comes.

By starting early, knowing what kind of transaction you want, understanding your business’s value, optimizing financial performance, and identifying buyers ahead of time, you’ll be setting the stage for a successful and profitable business exit.

Spencer Farrell

Spencer Farrell is a growth-focused executive with deep experience in operations, strategy, and business development. He works with Nacre Consulting, Meritas Equity Partners, and in private equity—leading deal origination, fundraising, and structuring. A former SaaS sales leader, Spencer also invests in startups and real estate across WNY. He holds a B.S. in Finance and an MBA from Niagara University and serves as President of the Canisius High School Board of Governors.