Common Pitfalls When Selling Your Company

Many mistakes made by first-time sellers cause a potential deal to collapse or the price they receive for their company is greatly reduced as a result of the most common pitfalls when taking your business to market. Acquirers consider each of these mistakes as serious and they may undermine their confidence in your competence as well as the value of your business.

When working with an experienced M&A advisor team from IBA Corporate, we will help you avoid the following pitfalls:

● a misunderstanding of what value is in M&A and how to price it

● failing to plan for an exit and not knowing what comes after the sale

● not preparing before going to market

● not respecting confidentiality

● underestimating your own importance in the transition of ownership


While it’s important to have a valuation carried out on your business so that you know whether this is the right time for you to sell financially or not, the value of your company is more than just a number arrived at by an M&A advisor.

There is released value in your business and there is unreleased value – value which you and your management team haven’t unlocked yet or value which you didn’t realise existed. Furthermore, additional unreleased value in your business can be discovered by understanding the motivation behind why a buyer would want to purchase your company and what they would change about your company under their ownership.

The real value – the premium which makes your business more valuable than you might believe – can often only be seen by people outside of your company. We help you realise where that unlocked value is and we make it a fundamental part of the marketing material we create for acquirers.


Selling your business is an escape. You know what you’re escaping from but do you know what you’re escaping to?

Do you know what you want to do after the completion of the sale? Do you know how much that would cost? Do you know what you’re going to replace the 40-60 hours a week your business already takes up with?

These may seem like trivial questions now but, as experienced M&A advisors, it’s important to know whether you can “afford” the exit which may be on offer to you. If you still need to generate an income following an exit, you need to start planning now with a view to building up an income you and your family can sustain itself on post-completion.


Once you and your acquirer have agreed a price, your solicitors and accountants and the acquirer’s solicitors and accountants embark on a lengthy process called due diligence. Due diligence is the process used by acquirers to truly understand as much as possible about the company they’re buying.

The findings of due diligence then shape the ongoing negotiations between you and the acquirer as both sets of solicitors draw up the sale and purchasing agreement – the legally binding document governing the acquisition and outlining your responsibilities and the acquirer’s responsibilities post-completion.

When working with an experienced M&A advisor, you will be given substantial assistance in preparing the documentation required for due diligence. We do this not only for use in this process but as part of our own fact-finding about your company. This is so that we can plan and execute a successful marketing campaign to those buyers who would benefit the most from owning your business.


If you’re considering selling your business or the sales process has actually started, careful attention needs to be paid to who knows about it and when. For your own staff, they should always hear it from you or your senior management team – if it comes from a third party source, there is a substantial risk of panic breaking out among your staff.

During the sales process, you and your management team must continue to maintain and improve profitability and productivity otherwise the price you agreed at the start of the process may reduce because of financial and operational disruption.

A lack of control over when the information is released may lead to staff looking elsewhere for work and to customers seeking another supplier. A leak of the information may also dent an acquirer’s trust in you and your ability to personally see the process through to the end.


The most attractive types of companies for acquirers are those where the owner has the least day to day responsibility in making sure that the company runs profitably, efficiently, and legally. Companies with strong and experienced management teams are particularly prized by acquirers.

Even though your company may not need you in the way that it did when it was growing, you are still the boss to your employees and they will require a certain degree of input from you. This is especially so when managing the transition process as your company changes ownership.

Your acquirer needs reassurance that you will do everything possible to ensure that the transition is as smooth as possible and that, despite their initial reservations and fears, your current staff have nothing to worry about and that they should embrace and welcome the new owner’s ambition.


Our team of M&A advisors has decades of combined experience in helping clients take their companies to market, in finding interested and motivated buyers, and in helping you and your acquirer navigate the process from the shaking of hands to the day of completion.

We look forward to working with you – please call us, email us, or fill out the form on our site to get in touch with us.

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