How to Sell My Business? 2025 Owner’s 101 Guide

Short version: Price it realistically, package it professionally, control confidentiality, and manage the deal like an adult. The rest—multiples, tax, LOIs—are tools. This guide shows the full path from decision to close.

What Is My Business Worth?

Value is the price a capable buyer will pay for future cash flows at an acceptable risk. For owner‑operated firms (Main Street), value is usually a multiple of SDE. For larger firms with management, EBITDA multiples dominate.

How We Value Businesses: Revenue, Margins

• Top‑down sense‑check: revenue size, gross margin, net margin, growth trend.
• Bottom‑up quality: customer concentration, systems, recurring revenue, reliance on owner.
• Market sanity: recent comps by niche and geography.

SDE vs EBITDA: Which Applies to Your Business?

SDE (Seller’s Discretionary Earnings) = pre‑tax profit + owner salary + normalised add‑backs. Used for smaller, owner‑run businesses. EBITDA excludes owner comp and is used when there’s a management layer. We help you recast cleanly and defend it to buyers.

Current Market Multiples & Efficiency

Multiples expand with growth, defensibility, and transferability. They compress with key‑person risk, messy books, and customer concentration. Efficiency (working capital needs, CAC payback, gross margin) adjusts what buyers are willing to pay.

How Long Does a Business Exit Take? (Typical 3–12 Month Timeline)

• Preparation & packaging: 2–6 weeks
• Buyer outreach & meetings: 4–12 weeks
• LOI to close (diligence & legals): 6–16 weeks

Business Sale Process

Preparation

• Recast P&L (SDE/EBITDA), normalise add‑backs.
• Fix obvious risks (contracts, licences, IP, payroll anomalies).
• Assemble a clean data room.

Packaging

• Teaser (blind): industry, location, revenue, SDE/EBITDA; no names.
• CIM: story, numbers, operations, growth levers, transition plan.

Buyer Outreach & Confidentiality

• Signed NDA before CIM exchange.
• Controlled list: strategics, financials, known operators, select platforms.
• Discretion: protect staff, customers, suppliers.

IOI vs LOI

IOI (Indication of Interest) = soft range and key assumptions. LOI (Letter of Intent) = firm headline price/structure + exclusivity + timeline. Push for LOI clarity to reduce re‑trades.

Offers & Negotiation

• Defend deal logic (earnings quality, risk transfer), not just headline price.
• Trade structure for certainty: cash at close vs seller note/earn‑out.
• Agree working capital peg early.

Due Diligence

• Financial (quality of earnings), legal, operational, HR, tax.
• Keep cadence: weekly issues list, owner/buyer decision log.

Closing & Handover

• SPA/APA executed, lien searches clean, consents obtained.
• Handover: logins, keys, supplier intros, transition plan.
• Funds wired; post‑close support delivered as agreed.

Due‑Diligence Checklist & Data‑Room Index

• 3 years financials & tax returns; bank statements
• AR/AP ageing, inventory, fixed asset register
• Material contracts, leases, licences, insurance
• Org chart, payroll, contractor agreements
• IP: trademarks, domains, code/repos, brand assets
• Policies: privacy, data protection, H&S

Deal Structures & Terms: Asset vs Share, Earn‑out, Seller Note, Escrow

• Asset sale: buyer picks assets/liabilities; cleaner for small deals.
• Share sale: continuity for contracts/licences; more diligence.
• Seller note: defers price; aligns risk.
• Earn‑out: ties price to future performance; define metrics tightly.
• Escrow/holdback: covers post‑close claims.

Working Capital & Deferred Revenue Adjustments

Most deals are cash‑free, debt‑free with a normalised working capital peg. SaaS/subscription models require deferred revenue treatment so buyers don’t pay twice for the same service obligations.

Taxes & Legal Basics: IP, Privacy, Assignability, Non‑compete

• Tax: share vs asset implications differ by jurisdiction; model both.
• IP chain‑of‑title and data privacy compliance are non‑negotiable.
• Contract assignability and landlord consent: solve early.
• Reasonable non‑compete/non‑solicit tied to consideration.

Who Buys Businesses? Strategic, PE & Aggregators

• Strategic: bolt‑on synergies, pay for fit and speed.
• Financial/PE: returns math; disciplined on diligence and structure.
• Aggregators/Operators: platform roll‑ups with playbooks.

Broker Fees vs DIY: Costs, Value‑Add & When to Use a Broker

• Typical Main Street success fee: ~8–12% (or a minimum). Larger deals use tiered scales.
• Value‑add: realistic pricing, confidentiality, packaging, buyer access, negotiation, deal management.
• DIY works when you already have a clean buyer and robust in‑house legal/finance.

Best Time to Sell a Business

• When earnings are stable and trending up.
• When key‑person risk is reduced and handover is credible.
• When you can afford a 6–12 month process without panic.

About Our “Become a Business Broker in 30 Days” Offer

Prefer to be in control and build a brokerage capability internally? Our 30‑Day Training is a 1:1, execution‑heavy sprint: valuation, packaging, buyer outreach, negotiation, compliance, and closing discipline—aimed at your first signed, fee‑protected mandate.