Top 5 questions asked (and answered) when selling a business

Sales & Growth
Systems & Operations

Special thanks to guest author, Axel Christiansen

They’re ready to retire, or to move on to a new challenge, but those who come to us to sell their businesses aren’t most concerned with money, they’re most concerned with their legacy and ensuring that those who helped build the business are well looked after.

We sat down with Axel Christiansen, CFA and Vice President of Renaissance Mergers & Acquisitions to see first hand what selling a business looks like. Axel’s been successfully assisting entrepreneurs with business transitions for over 25 years. He’s worked with every industry and agreed to answer the top five questions he gets from those looking to sell their business.

Christiansen typically works with those between 65-80 who are looking to retire from the business they’ve nurtured for the past 20+ years. Believe it or not, they’re more concerned with legacy and taking care of the firm’s people than maximizing their sale proceeds. They are generally apprehensive and rightfully emotional—they’re closing a significant life chapter.

Our job is to hold the hand of the seller during the entire process and help them achieve their specific objectives when selling their business. We pride ourselves on bringing an unparalleled level of service.”

Here are the top five questions asked by business owners that are looking to sell:

1. What does the process of selling a business look like, and how long does it take?

The process typically takes 6-9 months. That’s right, we’re in it for the long run. Here’s what the process looks like from my end:

Reverse due diligence

  • Collect information.
  • Ask questions (what might buyers like or not like about the business?)
  • Populate the data room.
  • Complete a detailed valuation (how much is reasonable to ask for?)
  • Build up a healthy team of advisors such as an M&A lawyer, tax advisor and operations consultant.

Develop marketing materials

  • Create a spot sheet—a one pager highlighting the business for sale.
  • Develop the Confidential Information Memorandum—a large document that tells the full story about the business.
  • Research and develop the purchase roster—a list of high probability purchasers.

Go to market

  • Facilitate calls between the sellers and potential buyers.

Sort through the letters of intent and advise seller

  • Review different offers and help vendors make an apples to apples comparison.

Due diligence

  • Seller now selects purchasers to exclusively negotiate with through due diligence. With this, comes lots of additional questions, information requests, meetings and site tours.


  • Support the seller when working with lawyers. We focus on timelines and ensure important issues are top of mind, not getting bogged down in less significant details.

Celebrate with a closing dinner!

2. What’s the value of my business?

Value. It’s what every business owner wants to know about their business.

We use a variety of valuation approaches primarily based on cash flow. We look at factors such as historic volatility of cash flow (drastic ups and downs in revenues) concentration risk (client, supplier, products, staff), underlying market trends, company size and a host of other factors.

We also draw on our experience in similar transactions we may have recently taken to market.

The higher the risk of future cash flow amounts not being realized, the less the buyer will pay. The lower the risk, the more the buyer will pay.

We look at value early in the process to ensure we’re aligned with the seller’s expectations.

3. What are the typical challenges associated with selling a business?

Valuation approach

  • It’s imperative that we get to a normalized cash flow. This means having a thorough understanding of personal expenses, non-recurring expense items, rent and salaries. Our recommendation: be more conservative and don’t lose credibility with overly aggressive normalizations.


  • Cash is king. It’s not all about how much you get for your business—it’s how that money comes to you.

Working capital

  • How much is required to run the business for the new owner the day after it’s sold? There should be enough to keep the business operating at the current level, but not so much that the new owner can pay themselves a handsome dividend immediately post-closing.

Vendor fatigue

  • It’s real. Selling a business can be a long process and after 4-5 months, it’s sure to get frustrating, but it’s well worth carrying out.

woman selling her business, working at computer

4. Why would I use a merger & acquisition (M&A) advisor?

There’s a host of reasons to use a merger & acquisition advisor.


  • The seller may know who they want to sell to, but more often than not, the successful purchaser is not who they would have expected.
  • Advisors typically find purchases that sellers aren’t aware of.

Managing the process

  • Lean on a proven system and process in place.

Negotiating skills

  • Advisors usually have strong negotiating skills and a thorough understanding of market terms and conditions.

Removing workload from seller

  • The seller can continue to run their business, which is imperative during the tumultuous selling period.


  • With a capable advisor, the seller should achieve additional value well in excess of whatever fees the M&A advisor is charging.

5. What should I be doing to prepare?

Put simply, a number of things support the sale of your business.

Fix blind spots

  • Be it stepping up your operations A-game, or doing some marketing to increase sales, leaning into blind spots is a top priority.

Diversify your product offering

  • Having a broad range of goods and services is healthy.

Increase cash flow

  • Work on your predictable, growing cash flow.

Reduce client and supplier concentrations

  • Reel in a few new clients to spread the cash flow collection out and find a new supplier or two to build relationships with. Remember having all of your eggs in one basket isn’t ideal to a buyer.

Tighten up up systems

  • Create an owner operator guide and ensure that there are people in place to run the business without you.

In conclusion, selling a business is a mentally and emotionally draining process. But with our help, you’re poised to have a smoother process and come out ahead of the game financially.

Learn more and get in touch.

Incrementa (un)consulting

Incrementa (un)consulting is your partner in transforming your business. Our goal is to help achieve your audacious business goals and dreams.

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