Most owners have a number in their head for when they will sell: five years, seven, ten. Almost none of them have a plan for the offer that shows up in year three. Episode 18 of Call to the Bullpen, with Clint Overton and Ted Stann of Boardroom Bullpen, makes the case that exit timing belongs to the market, not the owner, and that the owners who capture full value are the ones who were ready before anyone asked.
How long does it take to prepare a business for sale?
Preparing a business for sale typically takes 18 to 24 months, and often longer, when the owner has not maintained clean financial reporting and a management team that can run without them. The time goes to correcting accounting mistakes, building reliable monthly metrics, and reducing the buyer’s dependence on the owner.
That figure comes from what Boardroom Bullpen sees in the market. “There’s oftentimes 18, 24, maybe longer months that are necessary in order to clean up all the finance and accounting mistakes that have been made in the past,” says Clint Overton, Managing Partner at Boardroom Bullpen, on Episode 18. The second half of the work is people: getting “the team positioned so that a potential buyer is going to look at it as, I’m buying something that can continue to scale.”
The alternative to that timeline is not a shorter one. It is a discounted sale, or a missed one. Ted Stann, co-founder of Boardroom Bullpen, whose background includes raising more than $300 million in capital, described the owner who has to sell into a down market without preparation: “What you’ve worked for your entire life now it’s a discounted value. Whereas you could have prepared for that, both on the financial side, the management team side.”
Why does the market decide when you sell?
The market decides exit timing because the best offers are driven by buyer motivation and market conditions, not by the owner’s calendar. Strategic buyers and competitors move when it suits them, and a five- or ten-year plan does not obligate anyone to wait.
Overton was direct about it: “You may have a five or a seven or a 10 year time horizon, but the market opportunity, the best opportunity may be in three years instead of five years or in seven years instead of 10 years. And so that attitude of like, I can always wait, is probably fool’s gold a little bit.”
Stann added the type of buyer that makes this real. “Some of the best offers come out of the blue,” he said, and they often come from “someone that is a competitor in the marketplace, and they’re going to pay up. It’s a strategic buyer and they’re going to pay up.” A strategic buyer paying a premium is the best outcome most owners will ever see, and it tends to arrive on the buyer’s schedule. The owner’s job is to be able to say yes.
Life adds its own timing. Overton pointed to the other side of the ledger: “Potentially there’s a life event that’s happened in your family that is putting you in a position where you really need to sell your business.” Neither the good surprise nor the bad one waits for the books to be cleaned up.
What does “ready to sell at any time” actually require?
Being ready to sell at any time means the business produces reliable monthly financial statements, the leadership team is aligned on the same numbers, and a buyer could evaluate organic growth, customer concentration, customer acquisition cost, and margin from existing reports without a scramble.
Stann framed it as the baseline for running the company well, not as a special exit project: “From a financial reporting standpoint, you should be ready to sell it at any time because, I mean, that’s the heart of what you’re doing as a business is, hey, everyone’s on the same page. We’re actually seeing this from the financial statements.”
Overton offered the analogy that gives the episode its spine. Being ready is an insurance policy. “The reason why you buy an insurance policy, and you’re paying that premium month after month after month, is you’re trying to be ready for something that is going to happen when you can’t predict it.” The premium, in this case, is the cost of a real finance function and a monthly, quarterly, and annual review cadence. The payout is the ability to take the offer, or survive the life event, without a discount.
Why are so many owners not ready, even when they say they are?
Many owners are not ready to sell because they have run profitable businesses for decades on instinct and revenue, without the financial visibility a buyer requires. Saying “I’m ready” is a personal decision; the business being ready is an operational one, and the two rarely line up on their own.
Overton connected this to a demographic wave the show has covered before: “The whole idea of the silver tsunami, the baby boomers, is many of them have been running their businesses without this type of visibility for 10, 20, 30, 40 years.” His summary of the problem: “You’re finding so many of these folks who are saying I’m ready, but the reality is their business actually isn’t ready to be sold.”
The root cause, in his experience, is a specific under-investment. Owner-operators with strong sales “oftentimes underinvest or wait really long to invest in somebody who understands all of the finance and accounting capabilities that are required for them to have good visibility.” Without that person, the numbers a buyer will ask for, from gross margin by line to receivables collectability to whether equipment is properly depreciated, simply do not exist in usable form. Boardroom Bullpen’s post on the five fundamentals where businesses often struggle covers the same pattern across other functions.
What do buyers look for beyond the financials?
Beyond clean financials, buyers look for a management team and operating system that will keep performing after the owner leaves. A business that runs through the owner is worth less than one that runs without them, regardless of what the income statement says.
Overton’s phrasing on the show: “Once the owner exits, that business cannot be operating on them as a fulcrum, especially if they’re no longer there.” Stann listed the same requirement alongside reporting as the two things that keep an owner in a position to take any offer: “If you have the financial reporting in place, if you’ve got the strong management team, and the list goes on and on. If you have this in place, you’re always in that position where absolutely we’re always interested in listening to an offer.”
This is where many owners discover the 18 to 24 month timeline is not only about accounting. Building a second layer of leadership, documenting processes, and pulling the owner out of daily decisions takes time and usually outside help. Boardroom Bullpen’s fractional model exists for exactly this window; its work on critical business transitions and its solutions for small businesses are both built around getting a company to run without its founder.
How to start getting your business exit-ready this year
The episode’s advice, sequenced:
Get finance and accounting leadership in place first. Whether full-time or fractional, someone has to own the numbers. Overton’s observation is that this is the investment owners delay longest and regret most. Finance and accounting services on a fractional basis are the fastest way to close the gap without a full-time hire.
Set the review cadence. Monthly, quarterly, annually, with the same stair step every time: revenue, gross profit, operating profit, EBITDA, plus concentration, acquisition cost, and organic growth.
Clean up the historical mistakes now. Every accounting error left in place is a diligence finding later. Fixing them takes months, which is why the clock starts before you plan to sell.
Build the team that replaces you. Identify the decisions only you make and start moving them. A buyer is paying for the business, not for you.
Adopt the standing posture. In Stann’s words, be the owner who is “always interested in listening to an offer.” That posture only works if steps one through four are done.
Overton’s closing line applies whether you are a scaling tech company or a multi-generational manufacturer: build “the plan and the operating cadence in order to be successful for when the time comes, because it’ll probably come when you’re not ready.”
FAQ
Do I need a CFO before selling my business?
Not necessarily a full-time one, but you need someone with CFO-level understanding of your financials well before a sale. Buyers will ask questions about margin by revenue line, receivables, depreciation, and add-backs that an owner without finance leadership usually cannot answer. A fractional CFO is a common way to get that capability during the 18 to 24 month preparation window without a full-time hire.
What is the silver tsunami in business?
The silver tsunami refers to the large number of baby boomer business owners approaching retirement and expecting to sell their companies over the same period. As Clint Overton noted on Episode 18, many of these owners have run their businesses for decades without the financial visibility a buyer requires, so a large share of them are not actually ready to sell when they decide they are.
What is the worst time to decide to sell a business?
The worst time to decide to sell is when you are forced to, whether by a down market, a life event, or an unexpected offer you are not prepared to evaluate. Ted Stann’s warning on Episode 18 was that a forced sale without preparation turns a lifetime of work into a discounted value. Preparation is what turns a forced sale into a chosen one.
Should I accept an unsolicited offer for my business?
An unsolicited offer, especially from a strategic buyer or competitor, can be the best outcome an owner ever sees, because those buyers often pay a premium. Whether to accept depends on whether your business can withstand diligence. If your reporting and management team are ready, you can evaluate it on the merits; if not, the offer usually exposes the gaps and the price falls.
Listen to the full episode
Episode 18 also walks through how enterprise value and equity value are calculated and the specific factors that raise or lower a buyer’s multiple. Listen to Episode 18 here: https://www.buzzsprout.com/2512653/episodes/19844999