Exit planning
When is the right time to sell your business?
The signals that say now, the ones that say wait, and why the best time is usually earlier than owners think
By Michael D. Rubin, CEO & Founder · September 2026 · 1,550 words
Also answersHow do I know when it is the right time to sell my business?
The best time to sell is while the business is growing and you still want to run it. That sounds backwards, and it is the most reliable rule in this industry. Selling into two or three years of growth attracts multiple offers and creates genuine competition. Selling into a decline reads to buyers as a liquidation, and gets priced as one.
Which means the question is rarely 'is the market right'. It is 'is the business right, and am I ready'.
The three clocks
Three separate things have to line up, and owners usually watch only one of them.
- The business clock. Growth, clean records, management depth, revenue quality. Almost entirely inside your control, and slow to change — twelve to twenty-four months of work.
- The personal clock. Energy, health, family, what you intend to do next. The one owners discount and then regret discounting.
- The market clock. Buyer appetite, lending conditions and multiples in your sector. Largely outside your control and, for a single transaction, less important than the other two.
When all three align, you sell well. When only the personal clock has run out — the owner is exhausted, the numbers have drifted, nothing has been prepared — you sell badly. That, not the economy, is why most companies sell for less than they might have.
Signals that now is the right time
- Two to three consecutive years of revenue and earnings growth
- Financial statements that reconcile to the tax returns without explanation
- A management layer that runs the business when you are away for a fortnight
- Customer concentration inside a range a buyer will accept, with contracts behind the largest
- Contracted or recurring revenue that has grown as a share of the total
- You have thought about what you will do afterwards, and it is not 'nothing'
- You could keep going for three more years if you had to — which is what lets you say no to a bad offer
Signals to wait, and what to do meanwhile
| Signal | Why it costs you now | What to do first |
|---|---|---|
| Earnings falling year over year | Buyers price a declining business as a liquidation | Stabilize, then show two years of recovery |
| One customer above ~30% of revenue | Priced as risk regardless of the relationship | Grow others, or put the largest on a longer contract |
| The company cannot run without you | The buyer is buying a job | Twelve months of deliberate delegation |
| Records that do not reconcile | Every unexplained number discounts all the others | A CPA clean-up, and an add-back schedule with documentation |
| A dispute, claim or license problem outstanding | Buyers pay for certainty and discount ambiguity | Resolve it before market, not during diligence |
| No idea what you would do next | Sellers who do not want to leave sabotage their own deals | Have the conversation at home before the one with us |
On waiting for the market
Owners routinely delay a year to see whether multiples improve, and give up a year of preparation to do it.
For a single company the market matters less than the four things above. A prepared business sells well in a soft market. An unprepared one sells poorly in a strong one, because the discount for risk is applied whatever the conditions.
Interest rates are the exception worth watching, because they affect what buyers can borrow and therefore what they can pay. But rates are not something you can time — and a company made more valuable is worth more in every rate environment.
The two-year view
If a sale is somewhere on your horizon, the useful question is not when to sell. It is what needs to be true before you do.
Work backwards. Twenty-four months out: the honest baseline valuation, the owner-dependence work, and the revenue quality work. Twelve months out: financial clean-up, contracts and leases, the data room. Six months out: advisor selection, tax planning with your CPA, and deciding what you would accept.
That sequence is what pre-exit consulting does, and the twelve-month plan sets it out task by task.
The signal owners miss
One more, because it comes up in almost every discovery meeting we hold: the moment you start thinking about selling is usually the moment your engagement with the business begins to change.
Investment slows. Difficult hires get postponed. The five-year decision gets made on a two-year horizon. None of it is deliberate, and all of it shows up in the numbers a buyer will look at eighteen months later.
If you have started thinking about it, that is not a reason to rush. It is a reason to find out where you stand, decide on a timeline, and either commit to running hard for another three years or commit to preparing properly for two. The expensive option is the third one — drifting.
A confidential opinion of value is the cheapest way to start that decision. It costs nothing, nobody is contacted, and you will know within a week whether the number changes anything.
Why owners wait, and what it costs
Almost every owner we meet who sold later than they meant to gives one of three reasons: they wanted one more good year, they were waiting for the market, or they had not decided what came next.
The first two are usually a bad trade. A year spent trading is a year not spent preparing, and the preparation is worth more than the extra year of earnings in almost every case we have seen. The third is a genuinely good reason to wait — but it is a reason to work on the answer, not to postpone the question.
The cost of drifting is invisible, which is what makes it dangerous. It shows up as postponed hires, delayed capital spend and a slow drop in the numbers a buyer will eventually examine, none of which feels like a decision at the time.
The personal clock, taken seriously
Advisors write a great deal about the business and almost nothing about the owner, which is backwards: in our experience the personal side is what decides whether a sale happens at all, and whether the seller is glad afterwards.
Four questions worth answering honestly, in writing, before you talk to anyone:
- What will you do on the Monday after closing? Sellers without an answer routinely sabotage their own transactions in the final fortnight.
- What number do you actually need? Not what you would like — what the proceeds have to do for the rest of your life. Work it out with a financial adviser first; it changes which offers are acceptable.
- What matters besides money? The employees, the name, the customers, whether the buyer keeps the yard. These are negotiable, and they are much easier to negotiate before an offer than after.
- Is your family in agreement? A spouse who is not ready is the most common late-stage reason a transaction stops.
The events that force the clock
Some sales are not chosen. The industry calls them the five Ds — death, disability, divorce, disagreement and distress — and they share one feature: the seller has no time and no leverage.
A company sold under one of these conditions typically achieves materially less than the same company sold on a planned timetable, because every buyer can see the constraint.
The protection is not complicated, and it is worth doing whether or not a sale is on your horizon: keep the financials in a state that could survive diligence, have a written succession plan for the key roles, make sure someone other than you can run the business for ninety days, and keep a current opinion of value in the drawer. That is preparedness, not pessimism.
What the market actually affects
Not nothing — but less than owners assume, and not in the way they assume.
Lending conditions decide what individual and SBA-financed buyers can pay, so they matter most at the smaller end. Private equity dry powder and appetite in your sector affects the top of the range. Industry cycles matter where a buyer is underwriting next year's earnings from a commodity price or a construction cycle.
None of those are things you can time, and all of them are secondary to whether your earnings are real, repeatable and documented. That is the part you control, and it is worth more than a favorable quarter.
A simple test
If you can answer yes to all six, now is a good time.
- Earnings have grown for two to three years and are growing now
- Financial statements reconcile to the tax returns without explanation
- The business runs for a fortnight without you
- No single customer is a share of revenue you would be embarrassed to disclose
- You know what you will do next, and your family agrees
- You could keep going for three more years if the right offer does not come
If the answer is not yet
Then you have the most valuable thing in this whole process: time. Twelve to twenty-four months of deliberate preparation moves the number more than any negotiation ever will. The twelve-month plan sets out the work, and pre-exit consulting is us doing it alongside you.
Start with a confidential opinion of value. It costs nothing, nobody is contacted, and it turns a vague intention into a decision with a date on it.