March 2025 Newsletter
7 Mistakes to Avoid When Selling Your Business
- Many small and mid-size company CEOs and business owners make major mistakes when selling their businesses. Unfortunately, it costs them millions of dollars in the process. Most deals die upfront due to business owners simply providing financial statements and then negotiating the price from the start.
- Without the proper expertise in mergers and acquisitions, your decades of hard work and long-term investment will be greatly diminished. These mistakes are often easily avoidable.
- As entrepreneurs, many dream of building their business into a big success in order to reap the rewards in the form of a successful exit. But planning for and conducting the sale is not as easy as it may appear. CEO Advisor, Inc. provides a full mergers and acquisitions service along with the expertise to advise you every step of the way.
- As a former CEO of a software company myself, I have built and sold businesses over the past 35 years, including conducting mergers and acquisitions advisory services for the past 20 years for my own firm, CEO Advisor, Inc. Note that even with my experience in mergers and acquisitions (M&A), I engaged with an M&A advisor for the sale of my software company as you should never sell your own business.
- Here are seven critical mistakes to avoid, and possibly have the perfect buyer slip through your fingers altogether.
- Mistake 1: Not Planning Ahead or Waiting Too Long to Sell
- Not planning in advance and especially waiting too long to sell can cause many business owners to miss their window of opportunity. It takes 6 months or more to sell a small to mid-size business. Planning is key to any successful business sale. You just never know when that perfect buyer will call you and is ready to make you an offer you can't refuse, or illness strikes and you need to sell your company - if only you were prepared!
- Mistake 2: Not Thoroughly Preparing for the Sale
- This mistake is extremely prevalent and is mind boggling to me. Business owners often spend decades building their businesses and then won’t spend 2-3 months to prepare their business for a sale. There is a complete range of preparation tasks that will ultimately, 1) Greatly enhance the price of your company and B) Greatly enhance your odds of securing a buyer and closing the transaction. Preparation of a virtual Data Room is critical today and requires the expertise and efforts of a firm experienced in mergers and acquisitions.
- Mistake 3: Not Finding the Right M&A Firm to Represent Your Business
- For continuity purposes, the same advisory firm that helps you with the preparation for the sale should be the same person and firm that sells your business. Otherwise, this can cost you a lot of time and money in the long run. Without this continuity of knowledge of your business coupled with the needed expertise, you may see no results and have to start the process all over again.
- Make sure to choose - and continue to work weekly - with a very seasoned, experienced M&A advisor. Make sure not to get passed onto a junior person, or have a junior person work on your sale behind the scenes. This will be a disjointed and very costly situation that may not result in a sale at all. CEO Advisor, Inc. personnel all have 30 – 42 years of experience as this level of expertise is needed in mergers and acquisitions to optimize and achieve your exit.
- Mistake 4: Not Investing in an M&A Advisor in Order to Conduct a Competitive Sale Process
- Too many CEOs and business owners are flattered by an inbound unexpected inquiry to buy their business and latch onto this “so-called” buyer – when 98% of them are not qualified, or are low-ballers, or don't have the funds to close a transaction. After many years of hard work, the only thing that makes sense is to instill urgency and competition into a sale of a business and to have an experienced, focused M&A advisor conduct a competitive Sale Process – full stop. Business owners love to latch onto a single, unsolicited prospective buyer as it seems like a clean, simple slam dunk way to exit and sell, but this is just not the case 99% of the time and results in a long, tedious sale at a lower price and undesirable terms and most do not close.
- Mistake 5: Playing Negotiator Upfront and Expecting Too Much or Too Little for the Business
- Too many business owners get a random call from a potential buyer and all of a sudden their head swells and they become an M&A expert despite zero experience. This segues into a price discussion – a very big mistake! Valuing your business and asking for an unrealistic price can destroy your chance to secure a buyer. Expecting to get top dollar for a business that is not prepared to be sold with little information available, that generates little profit, has low Gross Profit Margin or has slow growth is simply not realistic. Consider the size and health of your industry, the value (selling price) of comparable businesses, the economy, size of your business, growth rate, Gross Profit Margin, Net Profits, strength of your products, management team, and other factors when determining your value in preparation for a sale. But, playing negotiator yourself is a formula for a failed deal!
- Another mistake is to value the business too low. Often business owners will price their business low because they are burned out, suffer from an illness or did not get good advice. Do your homework and listen to your M&A advisor. Review and assess research about other business sales and make prudent decisions to optimize your sale price and increase your odds of a successful sale.
- Mistake 6: Not Being Engaged in the Sale at the Proper Time
- Selling your business will take a team of a M&A advisor, a corporate/transaction attorney and a CPA/tax advisor. Your M&A advisor will lead and manage the process but don't underestimate the time and focus it will take for the entire sale process. Listen to your M&A advisor with decades of expertise and be engaged at the proper time, such as the preparation work, giving your presentation to prospective buyers, review and discuss offers with your M&A advisor and other key points in time.
- Mistake 7: Accepting the Wrong Offer or Buyer
- Review offers with your M&A advisor and make the best selection for the long term. Ask yourself, is this the best company to buy and operate my business? Can they quickly connect with my customer base and learn how to market effectively? Does this buyer have the funds to close? What is the probability to close with each buyer? When the business sale goes as planned, it creates a tremendous opportunity for both businesses. You need to stay engaged, work closely with your M&A advisor and continue your success as a team towards closing a transaction.
- CEO Advisor, Inc. is an M&A advisor with the expertise and experience to help you through this challenging and exciting process. To address your questions and mergers and acquisitions needs, contact Mark Hartsell, MBA, President of CEO Advisor, Inc. at (949) 629-2520, by mobile phone at (714) 697-3370, by email at MHartsell@CEOAdvisor.com or visit us at www.CEOAdvisor.com for more information.
Misconceptions of an M&A / Business Advisor - and the Real Facts
Since 2004, CEO Advisor, Inc. has provided hands-on business advisory, growth capital and mergers and acquisitions advisory services to CEOs and business owners of small and mid-size businesses. Over the past 20 years, I have spoken to over a thousand CEOs and listened intently to their aspirations and challenges, and personal and professional goals.
During these two decades, I have heard many misconceptions and apprehensions that CEOs and business owners have about working with and gaining the experience, expertise and hands-on work and commitment of a M&A/business advisor.
Here are six misconceptions about hiring a strong, professional, experienced and hands-on M&A/business advisor:
Misconception 1 - I will lose control of my company. Actually, you will not lose control of your company or anything for that matter. In fact, you will set goals with your advisor and execute on your goals far better than you ever have resulting in far greater results and satisfaction in running your business, acquiring a business for accelerated growth, or selling your company, while maintaining complete control and decision-making.
Misconception 2 - A mergers and acquisitions advisor or business advisor creates undue influence or pressure on me as the CEO / business owner to make decisions or changes to the business that I will not be comfortable with. In contrast, a strong, loyal M&A/business advisor will work with you on a weekly basis to help you with your decisions and support you in working on, implementing and achieving your goals at your pace and timeline.
Misconception 3 - An M&A or business advisor will provide a lot of advice and then leave it to me to figure out how to do the work, allocate the time to get it done, and implement it on my own. CEO Advisor, Inc. prides itself with 20 years of hands-on work performed for CEOs by rolling up our sleeves, performing hands-on work on your goals, and collaborating with you on these key issues every step of the way to precisely meet your needs.
Misconception 4 – It is hard to understand or gauge the results of an M&A or business advisor because I used an advisor years ago and I didn’t see much results for the investment of time and money. CEO Advisor, Inc. takes a methodical and disciplined approach to growing, funding and buying/selling companies. We start the engagement by working with you to discuss and document your 5 to 10 highest priorities and goals, prioritizing these goals and assigning a target completion date for each goal. Our mode of operation is progress every week. We achieve this by hands-on work on your goals, collaborating with you to finalize and implement each goal and ensuring the success and completion of these goals. Many clients state that they have had several high priorities in the works for years and could never get them done and CEO Advisor, Inc. achieved them all in a few months.
Misconception 5 – I don’t believe I need help because I have run this business from day 1. If you are honest with yourself, everyone needs help to accelerate their growth, overcome business challenges, increase their profits and maximize the value of their business and especially with selling their business, and CEOs and business owners are no exception. After 15 years in corporate America, I was the CEO/founder of a software company from 1996 to 2003, which was successfully sold to a Nasdaq company. Sitting in that CEO seat of my technology company with the many, many tasks, challenges and goals that I had to handle for too many hours a day was the impetus for me starting CEO Advisor, Inc. It has proven to be extremely helpful to many CEOs, young and not so young, for two decades.
Misconception 6 - M&A / business advisors are not affordable for a company of our size. CEO Advisor, Inc. provides very affordable pricing as a set monthly retainer so there is absolutely no surprise billing each month - just a retainer for an agreed upon number of hours of hands-on advisory services each month that you decide best suits your needs.
For transaction related engagements (funding for growth capital or acquisitions for growth, or the sale of your company) there is an additional one-time fee only upon successfully completing a transaction as stated in our engagement agreement, but the monthly retainer never increases no matter how many hours per month CEO Advisor, Inc. invests in completing your transaction.
As you can see, just like every CEO / business owner is different, just like every company is different, I can assure you that every M&A / business advisor is different and CEO Advisor, Inc.'s reputation is top notch with proven capabilities, experience and expertise to maximize your results and the return on your investment. I, personally, work with every client the majority of the time to best serve your needs.
Contact Mark Hartsell, MBA, President of CEO Advisor, Inc. for a no cost initial consultation at (949) 629-2520, by mobile phone at (714) 697-3370, by email at MHartsell@CEOAdvisor.com or visit us at www.CEOAdvisor.com for more information.
During these two decades, I have heard many misconceptions and apprehensions that CEOs and business owners have about working with and gaining the experience, expertise and hands-on work and commitment of a M&A/business advisor.
Here are six misconceptions about hiring a strong, professional, experienced and hands-on M&A/business advisor:
Misconception 1 - I will lose control of my company. Actually, you will not lose control of your company or anything for that matter. In fact, you will set goals with your advisor and execute on your goals far better than you ever have resulting in far greater results and satisfaction in running your business, acquiring a business for accelerated growth, or selling your company, while maintaining complete control and decision-making.
Misconception 2 - A mergers and acquisitions advisor or business advisor creates undue influence or pressure on me as the CEO / business owner to make decisions or changes to the business that I will not be comfortable with. In contrast, a strong, loyal M&A/business advisor will work with you on a weekly basis to help you with your decisions and support you in working on, implementing and achieving your goals at your pace and timeline.
Misconception 3 - An M&A or business advisor will provide a lot of advice and then leave it to me to figure out how to do the work, allocate the time to get it done, and implement it on my own. CEO Advisor, Inc. prides itself with 20 years of hands-on work performed for CEOs by rolling up our sleeves, performing hands-on work on your goals, and collaborating with you on these key issues every step of the way to precisely meet your needs.
Misconception 4 – It is hard to understand or gauge the results of an M&A or business advisor because I used an advisor years ago and I didn’t see much results for the investment of time and money. CEO Advisor, Inc. takes a methodical and disciplined approach to growing, funding and buying/selling companies. We start the engagement by working with you to discuss and document your 5 to 10 highest priorities and goals, prioritizing these goals and assigning a target completion date for each goal. Our mode of operation is progress every week. We achieve this by hands-on work on your goals, collaborating with you to finalize and implement each goal and ensuring the success and completion of these goals. Many clients state that they have had several high priorities in the works for years and could never get them done and CEO Advisor, Inc. achieved them all in a few months.
Misconception 5 – I don’t believe I need help because I have run this business from day 1. If you are honest with yourself, everyone needs help to accelerate their growth, overcome business challenges, increase their profits and maximize the value of their business and especially with selling their business, and CEOs and business owners are no exception. After 15 years in corporate America, I was the CEO/founder of a software company from 1996 to 2003, which was successfully sold to a Nasdaq company. Sitting in that CEO seat of my technology company with the many, many tasks, challenges and goals that I had to handle for too many hours a day was the impetus for me starting CEO Advisor, Inc. It has proven to be extremely helpful to many CEOs, young and not so young, for two decades.
Misconception 6 - M&A / business advisors are not affordable for a company of our size. CEO Advisor, Inc. provides very affordable pricing as a set monthly retainer so there is absolutely no surprise billing each month - just a retainer for an agreed upon number of hours of hands-on advisory services each month that you decide best suits your needs.
For transaction related engagements (funding for growth capital or acquisitions for growth, or the sale of your company) there is an additional one-time fee only upon successfully completing a transaction as stated in our engagement agreement, but the monthly retainer never increases no matter how many hours per month CEO Advisor, Inc. invests in completing your transaction.
As you can see, just like every CEO / business owner is different, just like every company is different, I can assure you that every M&A / business advisor is different and CEO Advisor, Inc.'s reputation is top notch with proven capabilities, experience and expertise to maximize your results and the return on your investment. I, personally, work with every client the majority of the time to best serve your needs.
Contact Mark Hartsell, MBA, President of CEO Advisor, Inc. for a no cost initial consultation at (949) 629-2520, by mobile phone at (714) 697-3370, by email at MHartsell@CEOAdvisor.com or visit us at www.CEOAdvisor.com for more information.
Copyright © 2025 CEO Advisor, Inc. All rights reserved.