Exit Planning
Exit planning is the process of developing a business owner’s strategy for what may be the biggest financial transaction of his or her life… the transfer of the business. That strategy may be a succession to the next generation of family. It could be a sale to employees. It may be a sale to another entrepreneur, or acquisition by a larger company. In some cases, it could require an orderly dissolution. In every case, it involves tax, legal, financial, operational and risk management expertise. Exit planning, in the true sense of the word, is coordinating all those skills to work together for a single objective.
- Avoiding the 75%: Why So Many Owners Regret Selling Their Business
 If you’re planning to sell your business someday, here’s a statistic worth sitting with: research from the Exit Planning Institute and PwC found that 75% of business owners feel “unhappy” or “profoundly unhappy” one year after exiting their company. Three out of four owners who worked hard to build something, then sold it or handed it off end up regretting how it turned out.
That’s not a small problem. And it’s been true for over a ... - What’s Your Business Really Worth? (Probably Not What You Think)
 If someone asked you right now what your business is worth, you’d probably answer fast, and with total confidence. That number’s likely made its way into conversations with your banker, onto a personal financial statement, maybe even into a retirement plan your financial advisor put together.
Here’s the uncomfortable part: there’s a good chance that number is off by 50% or more.
That’s not a knock on you. It’s just that most owners have never had access ... - Exit Planning: If Not Now, When?
 You’ve probably said it yourself: “Talk to me in five years.”
It’s the most common response advisors hear — and it makes sense. You’re heads-down building, not winding down. Exit planning feels like a conversation for later. The business is performing. You have time. And honestly, it’s a lot to think about.
But here’s the uncomfortable truth: later is exactly when most exits go wrong.
You’re already doing exit planning — just not deliberately
Think about the early-stage tech ... - The 3% Problem in Advisory Work: A Guide for Business Owners
 As a business owner, you belong to a unique group that makes up only 3% of the population. Yet, many advisors treat you like any other client—using the same approaches they apply to executives, professionals, or retirees. This is a fundamental misunderstanding that can impact your business and personal goals.
Why You’re More Than Just an Asset
You are not simply a high-income individual with concentrated wealth. Your business is not just an investment; it’s an integral ... - Manufacturer Stuck in the “Neutral Zone”
 Here is how exit planning helped a business owner out of the Neutral Zone.
This manufacturer reached out to an exit planning consultant after receiving a book on planning as a gift from a local professional. He was in no particular hurry to leave his business. In the preceding twenty years of ownership, he had grown it from a local vendor to home builders into a nationally known specialty house.
The company provided him with a good ... - NQDCs – Funding and Forfeiture
 In our last article, we discussed Non-Qualified Deferred Compensation (NQDC) plans as a tool to compensate key employees for achieving long-term goals. One component of such plans is the fact that they are frequently unfunded and legally considered an unsecured promise to pay.
Nonetheless, both plan sponsors and recipients often want a funding mechanism to set aside assets, manage cash flow, or hedge the liability. In addition, employers typically want conditions under which they can rescind ... - Quality of Earnings and Technology Costs
 When a Quality of Earnings audit identifies deferred technology, the price can be magnified many times. Are you deferring technology costs?
A few months ago, a subscriber to our planning tools called with a tech support question. “Your software doesn’t work,” he said. After some investigation, we identified the problem. He was using a version of the underlying engine, (a part of Microsoft Office) that was four or five generations past end-of-life. When asked about his ... - The Inexperienced Advisor – An Exit Planning Horror Story for Business Owners
 This is a cautionary tale for business owners—one that’s “based on a true story.” The facts are real, although the exact sequence of events might raise questions if the IRS were to take a closer look.
A small business owner received a $1,000,000 offer to sell his company. He had already been thinking about retirement, and the chance to cash out felt like a perfect opportunity. His original plan had been to sell the business to ... - What Business Owners Should Know from the 5th Annual Exit Planners Survey
 Between February 1 and March 2, 2025, ExitMap conducted its 5th annual survey of professionals who help business owners plan successful exits. This is the only survey that gathers insight across multiple advisory specialties—offering a wide-angle view of the professionals supporting entrepreneurs like you during one of the most critical transitions of your life.
The survey included 30 questions and was distributed to over 7,000 experienced advisors worldwide. These are professionals with recognized credentials in exit ... - The Exit Planning Fallacy – A Business Owner’s Perspective
 One of the most common sales pitches you might hear from someone claiming to help you “enhance value” goes something like this:
“I’ve reviewed your company and believe it’s worth $4.2 million today. With the right planning, it could be worth $7.7 million. Would you rather exit with $4.2 million or $7.7 million?”
That’s not really a question—it’s a setup. Of course, no business owner would willingly choose the smaller number. But the real issue isn’t which ...
|
