Business Lunch

The Exit Trap: What Most Founders Miss When It's Time to Sell

Jun 17, 2025
Dive into the world of mergers and acquisitions, exploring crucial strategies for selling your business effectively. Discover the difference between platform and tuck-in acquisitions, vital negotiation tactics, and the importance of understanding investor motivations. Learn how to maximize your company's value and prepare for a successful exit. Emotional complexities and relationship-building with investment bankers are also discussed, offering insights into navigating the private equity landscape. Equip yourself with actionable tips to avoid pitfalls in the sale process.
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INSIGHT

Platform Companies Command Higher Multiples

  • Being a platform company significantly increases your business value multiple during acquisition.
  • Tuck-in acquisitions typically receive lower multiples around 6 to 8x EBITDA compared to 12 to 15x for platform companies.
ADVICE

Run a Formal Sales Process

  • Run a formal sales process with multiple bidders to maximize your business sale price.
  • Interview several reputable investment bankers before selling for stronger negotiation power.
ADVICE

Maintain Sale Confidentiality

  • Keep your exit plans confidential to avoid employee and customer disruption.
  • Limit knowledge of the sale to key personnel until a deal is close to prevent performance issues.
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