When Should You Start Preparing for an Exit?

The phone call usually goes like this:

“Nick, I’m thinking about selling. I want to be out in the next six months.”

I ask four questions. How clean are the books? Who runs the business when you’re not there? What does customer concentration look like? Is there a management team, or is it all you?

By question four, the conversation has changed.

Most owners come to me when they’re already done emotionally. The problem is, the business isn’t ready. And the work that moves a valuation takes 12 to 24 months. The work that takes a deal from a 4x to a 6x, or from “no buyers” to multiple offers, doesn’t happen in a quarter.

Read that again. Twelve to twenty-four months. Minimum.

Why “I’ll fix it before I sell” doesn’t work

When I’m on the buy side, I’m not paying for what your business could be if you fixed a few things. I’m paying for what it is. Then I’m discounting that for every risk I see.

Owner dependency? Discount.

One client at 35% of revenue? Discount.

GM who’s been there six months? Discount.

Books that mix personal and business? Discount.

Each of those takes real time to fix. Not “I’ll clean up the QuickBooks this weekend” time. Real time. You can’t hire a #2, train them, and prove they can run the place without you in 90 days. You can’t diversify away from a 35% client in a quarter without blowing up revenue. You can’t show three years of clean books in three months.

The buyer wants to see trend. Not a snapshot.

What the work actually looks like

When clients hire me to coach them through this, the conversation in month one is rarely about the sale. It’s about the business. We look at concentration. We look at the team. We look at the financials. We map out where the gaps are and how long it’ll realistically take to close them.

By month six, the conversation has shifted. The owner is starting to see their business the way a buyer will see it.

By month twelve, we’re talking about positioning, banker selection, and timing the market.

By the time the CIM goes out, the business is a different business than it was when we started. That’s not magic. That’s just the work, done in the right order, with enough runway to do it well.

The owners who try to compress this into 90 days don’t sell. Or they sell, and they leave seven figures on the table. I’ve watched it happen. It’s painful to watch, and it’s almost always avoidable.

The hard truth

If you’re reading this and you’re already exhausted, I get it. You probably should have started two years ago. You didn’t. Fine. Start now.

The biggest lie in this business is that you can will an exit into existence on your timeline. You can’t. The market doesn’t care about your timeline. The market cares about whether your business is buyable.

The owners who win at this are the ones who decide, years before they’re ready to leave, that they’re going to build a business that’s worth selling. Whether they sell or not is almost beside the point. The work is the same either way.

If you didn’t know, now you know.