What Nobody Tells You About Selling Your Business

NorthStar Recorded Conversations: Real Conversations About Building, Selling, and Transitioning Businesses

If you've ever searched "How do I sell my business?", you've probably found articles about valuations, taxes, and finding buyers.

What you won't find are the conversations that happen after you've decided to sell.

Selling a business is one of the biggest financial and emotional decisions a business owner will ever make, yet most owners only experience it once. Along the way, there are misconceptions, unexpected challenges, emotional moments, and lessons that simply don't show up in a Google search.

In this NorthStar Recorded Conversation, founding partners Tom Bronson, Jeremy Furtick, and John Gorbutt answer the questions business owners ask most and the ones they don't know to ask until they're already in the middle of a transaction.

Editor's Note: This conversation has been lightly edited for clarity and readability while preserving each speaker's perspective.

What's the Biggest Misconception Business Owners Have About Selling Their Business?

Tom Bronson

I think it's really twofold. First, business owners think selling a business is an event. It's not—it's a process, and that process takes time.

A lot of owners picture it like selling a house. You put up a "For Sale" sign, wait a few months, close the deal, and head off to the beach. That's simply not how it works.

Preparing a business for sale takes time. Running a professional sale process takes time. And many owners wait far too long before they start thinking about it.

The second misconception is that because they're really good at running their business, they think they can sell it themselves.

Selling a business requires a team. You need experienced M&A advisors, attorneys, CPAs, valuation experts, tax planners—people who know how to navigate the process and help you maximize value.

Running a business and selling a business are two completely different skill sets.

Jeremy Furtick

I'd add that there are really two extremes.

Some business owners think selling their business is going to be easy.

Others think it's impossible.

The truth is it's neither.

It's never as easy as you think it's going to be, and it's never as difficult as you think it's going to be—if you're following the right process.

That's why having experienced advisors matters. The process gives owners confidence because they're not trying to figure everything out on their own.

John Gorbutt

We recently worked with an owner who told us, "I never could have done this without you, but I had the misfortune of trying."

She tried selling the business herself. The deal failed.

It took an incredible amount of work, and ultimately, she still needed professional help to get the transaction across the finish line.

The challenge is that selling a business becomes a full-time job.

If you're focused on selling it, who's running it?

Buyers want to see a healthy, growing business.

If sales begin slowing down because the owner is consumed by the transaction, the value of the business can actually decline while it's being sold.

Tom Bronson

John's exactly right.

Selling a business is a full-time job.

If you're already working full-time running your company, when are you going to have time to manage buyers, answer due diligence requests, coordinate advisors, negotiate terms, and keep everything moving?

We've seen too many owners take their eye off the business because they're consumed with the transaction. Sales slip, key employees leave, customers notice and suddenly, the company is worth less than it was when the process started.

That's why having someone else manage the transaction is so important. It allows the owner to stay focused on what buyers want most: a healthy business that's continuing to perform.

When Should I Start Preparing to Sell My Business?

Tom Bronson

Before you ever invoice your first customer, you should understand how you're eventually going to transition the business.

Most owners spend years building a great company but never stop to ask themselves what their ideal exit actually looks like.

When do you want to sell?

Why?

How much does the business need to be worth?

What type of buyer are you looking for?

If you can answer those questions early, you begin making better decisions throughout the life of the business because you're building toward an outcome instead of hoping one happens.

Jeremy Furtick

I take it one step further.

The process of selling your business begins the day you decide to open it.

Every hiring decision, every pricing decision, every customer relationship, every operational improvement—it all affects the future value of your business.

Whether you're thirty years away from selling or three years away, the sooner you begin thinking like a future seller, the better positioned you'll be when the opportunity comes along.

John Gorbutt

Business owners spend a tremendous amount of time working in the business.

They also need to spend time working on the business.

Step back occasionally and ask yourself:

"If I were buying this company today, what concerns would I have?"

Buyers are going to uncover those things eventually.

You're much better off identifying them yourself while you still have time to improve them.

Is It Ever Too Late to Get Ready to Sell Your Business?

Jeremy Furtick

I don't think it's ever too late because "ready" is subjective.

We've sold businesses that, if they were mine, I wouldn't have considered exit ready. But life doesn't always give you the luxury of waiting. Health issues, family circumstances, relocations—sometimes those things create urgency, and owners need to sell.

In those situations, the question becomes, "Am I willing to accept today's value instead of the value I could have created with more preparation?"

The only time I would say it's truly too late is when the business has deteriorated to the point that buyers no longer see a future.

I've had owners say, "Look what this business did four years ago." But buyers aren't purchasing what the business used to be—they're buying what it is today and what they believe it can become tomorrow.

If you've lost key customers, key employees, or allowed the business to decline, buyers aren't interested in rebuilding what was already built once before. They want a business they can take from where it is today and continue growing.

Tom Bronson

I agree with Jeremy, but I would add one exception.

There is a point where it truly becomes too late, and that's when the business is completely dependent on the owner.

I recently worked with an attorney representing the estate of a business owner who had passed away.  The family depended on the business for income and wanted to sell it.

Unfortunately, by the time we looked at the company, there was nothing left to sell.

The customers had already gone elsewhere. The business existed because of the owner, and once he was gone, so was the value.

What made it especially difficult was knowing he had several months to prepare for a transition but never did.

That's why we talk so much about building an exit-ready business.

It's not just about maximizing value when you're ready to retire. It's about protecting your family, your employees, and the legacy you've worked so hard to build when life takes an unexpected turn.

Jeremy Furtick

That's an important distinction.

A business can still be sellable without being fully prepared.

The difference is the price you'll receive.

Owners who prepare years in advance have more options, more leverage, and typically command higher valuations.

Owners who wait until circumstances force a sale often find themselves making decisions under pressure instead of on their own terms.

Is Purchase Price Really the Most Important Part of the Deal?

Jeremy Furtick

Yes... and no.

Let's be clear—purchase price and the structure of that purchase price are extremely important.

If a buyer isn't making a competitive offer, there's really no conversation to have.

But once you have multiple competitive offers on the table, something interesting happens.

In our experience, sellers often choose an offer that isn't the highest because they begin evaluating the things that matter beyond dollars.

We spend a lot of time early in the process asking business owners what their ideal buyer looks like. For some owners, it's about protecting employees. For others, it's preserving their company's reputation, taking care of long-time customers, or finding someone who shares their values.

Every owner has a different definition of the "right" buyer.

Another factor we evaluate is closability—how likely is this deal to actually reach the closing table?

We've been through hundreds of transactions, so we recognize the warning signs. Sometimes the highest offer comes with the highest risk. A slightly lower offer from a well-qualified buyer who has a strong likelihood of closing may ultimately produce the better outcome. After all, 100 percent of nothing is still nothing.

Tom Bronson

Purchase price is certainly one of the most important parts of a transaction, but it's only one piece of a much larger puzzle.

Every offer has multiple components—cash at closing, earn-outs, seller financing, working capital adjustments, holdbacks, and other terms that can dramatically affect what you actually receive.

A $20 million offer isn't necessarily better than an $18 million offer if most of that extra money depends on future performance or payments that may never materialize.

That's why we encourage our clients to focus on one number first: cash at closing.

If you're not comfortable with the amount you'll receive on closing day, you should think very carefully before accepting the deal. Future payments aren't guaranteed.

Understanding those differences—and negotiating them effectively—is one of the biggest reasons experienced M&A advisors add value throughout the transaction.

John Gorbutt

I've seen owners willingly accept a lower offer because they believed it was the better home for their business.

Many founders care deeply about what happens after they're gone. They've spent decades building relationships with employees, customers, and suppliers, and they want to know those people will be taken care of.

If the highest bidder plans to eliminate jobs or completely change the culture, some owners simply aren't comfortable with that.

In those situations, they step back and ask a different question:

"Which buyer gives me the greatest confidence that what I've built will continue to succeed?"

Legacy matters.

For many owners, that's worth more than squeezing out every last dollar from the purchase price.

Tom Bronson

I've lived that personally.

When I sold one of my companies, we accepted the second-highest offer.

It wasn't because the highest offer wasn't attractive financially. It was because the second buyer represented the best future for our employees, our customers, and the business we'd spent years building.

We believed they were far more likely to close the transaction and continue what we'd created.

That's what made it the best offer.

The highest number isn't always the right decision.

The best deal is the one that aligns with your financial goals, your legacy, and your vision for what happens after you walk away.

Why Do Deals Fall Apart After the Letter of Intent?

John Gorbutt

The simple answer is due diligence.

Once a Letter of Intent is signed, buyers begin digging into every aspect of the business. They're validating the financials, reviewing operations, evaluating customers, and trying to understand exactly what they're buying.

That's often when issues surface that weren't identified earlier.

Maybe there are low-margin accounts that aren't contributing much to profitability. Maybe there are operational challenges that weren't obvious at first. Buyers start asking questions because they're trying to understand the future value of the business.

That's why preparation is so important.

The more owners understand their business before going to market, the fewer surprises there are once due diligence begins.

Jeremy Furtick

We spend a lot of time talking about what we call pre-diligence.

Every business has warts. There isn't a perfect business out there.

Our job [as M&A Advisors] is to find those issues before buyers do. We want to understand them, document them, and help the seller explain them honestly and confidently. That way, when buyers reach due diligence, they're not discovering surprises—they're confirming what they've already been told.

The other thing that kills deals is time.

There's an old saying in M&A: time kills deals.

When sellers aren't prepared and it takes weeks to locate documents or answer basic questions, buyers begin losing confidence. They start wondering, "If the owner can't find the corporate records or financial information, what else is disorganized?"

The longer a transaction drags on, the more opportunities there are for financing to change, business performance to shift, or buyers to simply walk away.

Preparation keeps momentum moving forward.

Tom Bronson

One of the biggest misconceptions is that once the Letter of Intent is signed, the deal is done.

It's not.

In many ways, that's where the real work begins. Due diligence is designed to uncover things the buyer didn't know when they made the offer. If they discover issues, they're almost certainly going to come back and ask for changes to the purchase price or the deal terms.

We prepare our clients for that from the very beginning.

We tell them, "Don't assume this is the last price you're going to see."

That's a normal part of the process.

Sellers who understand that are far less likely to react emotionally when those conversations happen. Sellers who aren't prepared often feel blindsided. That's when emotions take over, and unfortunately, emotions are one of the biggest reasons good deals fall apart.

Jeremy Furtick

That's another reason representation matters.

When you've been through hundreds of transactions, you recognize the warning signs before they become problems.

We know what buyers are likely to ask for, what documents they'll need, and where deals typically get off track.

Our job is to help sellers stay focused on the end goal rather than getting discouraged by what's often a very normal part of the process.

What Surprises Business Owners Most During Due Diligence?

Jeremy Furtick

The biggest surprise is usually the sheer amount of information buyers want.

Owners often tell us,

"I had no idea how much I didn't know about my own business."

Buyers aren't just reviewing your financial statements. They want to understand every aspect of how the business operates. They'll ask about equipment, software, contracts, employee benefits, insurance, technology, customer relationships—even things that seem insignificant to the owner.

To a business owner, it's just the computer sitting on the desk that's worked for years.

To a buyer, they want to know what software is installed, whether it's under warranty, and if there are licensing agreements that transfer with the business.

That's just one example. The level of detail can be overwhelming if you're seeing it for the first time.

The good news is that you don't have to have every answer.

It's okay to say, "We don't track that," or "That doesn't apply to our business." What matters is being honest and prepared—not pretending to have information you don't.

John Gorbutt

That's exactly why we spend so much time on preparation before a business ever goes to market.

Every company has a few warts. The difference is whether we discover them first or the buyer does. Sometimes sellers don't want to talk about those issues because they think they'll scare buyers away.

We see it differently.

We'd much rather identify them ourselves, understand why they exist, and explain them upfront.

If buyers discover something you didn't disclose, they naturally begin wondering what else they haven't been told.

It's always better to address those conversations on your terms rather than theirs.

Tom Bronson

Buyers are going to find everything.

That's simply the reality of due diligence.

Our job is to help sellers identify potential issues before buyers do so they can be disclosed appropriately and explained in context.

Maybe the business had a bad quarter.

Maybe there was an operational challenge.

Maybe there's customer concentration.

Those things don't necessarily kill a deal.

What hurts value is when buyers uncover them unexpectedly.

When buyers already understand the situation before making an offer, they price the business accordingly. When they discover it later, it often becomes an opportunity to renegotiate the purchase price or change the terms.

Transparency builds credibility—and credibility helps transactions move forward.

John Gorbutt

Buyers aren't looking for perfection.

They're looking for confidence.

If you've identified your challenges, understand them, and can explain them, buyers generally respect that.

Every business has imperfections.

The businesses that command the strongest offers are the ones where owners understand those imperfections and demonstrate they've built a company that's still valuable despite them.

If I'm Not Planning to Sell for Five or Ten Years, What Should I Be Doing Today?

Tom Bronson

I'd start with a valuation.

Understand what your business is worth today and, just as importantly, understand why it's worth what it's worth.

Every industry is valued differently, and knowing how buyers evaluate businesses like yours gives you a roadmap for increasing value over time.

Sometimes owners discover they're much closer to their goals than they thought. Other times they realize there are opportunities to strengthen the business before going to market.

Either way, understanding your current value is the first step toward improving it.

Jeremy Furtick

Get your financials in order.

I can't overstate how important clean financial records are.

The easier it is for someone outside your company to understand your numbers, the easier the entire sale process becomes. That means having accurate financial statements, consistent reporting, and the right advisors helping you maintain them. When owners wait until they're ready to sell before cleaning up their books, they're already behind.

Good financial reporting isn't just something buyers appreciate—it's something that helps you run a better business today.

John Gorbutt

I'd encourage owners to take a fresh look at their business.

Sometimes we find things owners haven't thought about in years.

Maybe you're paying for storage units you no longer use.

Maybe company vehicles aren't properly insured.

Maybe processes only exist in one employee's head.

Those little things may not seem important today, but buyers notice them.

Start looking for those inefficiencies now instead of waiting for someone else to point them out during due diligence.

The sooner you identify them, the easier they are to fix.

Tom Bronson

I'd also encourage owners to think like a buyer.

Step outside your role as the founder for a moment and ask yourself:

"If I were buying this business today, what would concern me?"

One of the biggest things buyers look for is owner dependency.

The moment your business can successfully operate without you, its value increases dramatically.

Buyers don't want to purchase another job.

They want to acquire a healthy, transferable business that continues operating successfully on day one.

Building that kind of business doesn't happen overnight.

It happens one decision at a time.

What About the Emotional Side of Selling a Business?

Jeremy Furtick

It's one of the few parts of the process you really can't prepare for—you just have to know it's coming. I had a client tell me once that selling his business was harder than giving his daughter away at her wedding.

For many founders, this business is all they've ever known. They've spent years building it, sacrificing for it, figuring out how to make payroll, solving problems, and celebrating successes with the people around them.

Then one day, during due diligence, it hits them.

They realize, "When this closes, this isn't mine anymore."

Even if they have a plan for what's next, that's a lot to process.

That's why I often say I'm half business advisor and half guidance counselor. Every owner experiences the emotional side differently, but every owner experiences it.

John Gorbutt

Another part that catches owners off guard is the questioning.

Buyers ask about every decision you've made—why you priced something a certain way, why you kept a customer, why you made operational changes.

Some sellers start feeling defensive, like they're being criticized. But that's usually not what's happening. Buyers aren't looking to point fingers. They're trying to understand how the business operates so they can successfully run it after the transition.

Once owners understand that, those conversations become much easier.

Tom Bronson

I remember one client in particular. He was incredibly analytical—an engineer by trade. Early in the process, I told him, "At some point this is going to become emotional."

He laughed and said, "Not me. I'm completely logical. This is just a business decision."

About a week before closing, my phone rang.

It was him.

He said, "Can we talk for a minute? I don't understand what I'm feeling right now."

Everything we'd talked about months earlier had finally caught up with him.

Selling a business isn't just selling an asset. It's letting go of something you've spent years, sometimes decades, building.

I reminded him of what we'd discussed at the beginning of the process, and I told him, "It's okay.

The sun's still going to come up tomorrow."

He laughed and admitted, "I guess I should've believed you."

That's why we spend so much time helping owners prepare emotionally as well as financially. The numbers matter, but so does the person who's spent a lifetime building the business.

If Every Business Owner Could Remember Just One Thing From This Conversation, What Would It Be?

John Gorbutt

Start today.

Take an honest look at your business.

Review your financials.

Look at your customers.

Examine your processes.

Ask yourself whether someone else could step in tomorrow and successfully run the company.

You'd be surprised what you'll uncover.

The more you understand your business today, the fewer surprises you'll face when it's time to sell.

And the more confidence you'll have knowing you're building a business that's ready for whatever comes next.

Jeremy Furtick

Realize your baby's ugly.

Every business owner loves the company they've built—and they should.

But every business has weaknesses.

The sooner you can acknowledge that your business isn't perfect, the easier the entire sale process becomes.

That doesn't mean your company isn't valuable.

It simply means you'll be better prepared to answer buyers' questions, improve areas that need attention, and ultimately build a stronger business.

Buyers aren't expecting perfection.

They're looking for honesty, preparation, and confidence.

Tom Bronson

Sit down with a blank sheet of paper and define what your ideal exit looks like.

When do you want to transition?

What does the business need to be worth?

What kind of buyer are you hoping to attract?

What do you want your life to look like afterward?

Business owners spend years building their companies, but very few spend time defining what success actually looks like when it's time to leave.

If you can paint a clear picture of where you want to end up, you'll make better decisions every step along the way.

Every business will eventually transition.

The question isn't if yours will.

The question is whether you'll be ready when that day comes.

Final Bearing

Throughout this conversation, one message kept surfacing: selling a business doesn't begin when you decide to sell—it begins with the decisions you make long before that day arrives.

The strongest businesses don't become valuable overnight, and successful transitions don't happen by accident. They happen because owners intentionally build companies that buyers want to own.

Whether your transition is two years away or twenty, the work you do today will determine the options you have tomorrow.

After all, every business will eventually transition. The opportunity is deciding whether you'll be ready when it does.

Ready to Understand Your Options?  

It all starts with knowing what your business is worth today. The team at NorthStar Mergers & Acquisitions can help you evaluate your opportunities and navigate a successful transition.

Contact NorthStar Mergers & Acquisitions to start the conversation.

Contact NorthStar Mergers & Acquisitions

About NorthStar Mergers & Acquisitions

Based in Dallas, Texas, NorthStar Mergers & Acquisitions guides business owners through one of the most significant financial and emotional journeys of their lives—the sale of a company. Specializing in lower middle-market transactions across multiple industries, NorthStar combines deep valuation expertise, strategic marketing, and buyer engagement to ensure every client achieves their dream exit.

Visit NorthStar-Mergers.com to learn more about how NorthStar helps business owners navigate their ideal transition.