Exit Readiness Scorecard

Section 1 of 6 · Owner Alignment Model™

Vision & Personal Readiness

Clarity on your personal exit vision is the foundation of everything. Most owners have revenue goals — not exit clarity. Rate each statement honestly.

Question 1 of 5

I have a clearly defined financial independence number — the net proceeds I need from an exit to fund my desired lifestyle indefinitely.

Without knowing your number, you can't know when you're ready. This single figure anchors every exit decision.

Critical GapFully Prepared

Question 2 of 5

I have a clear picture of what my life looks like post-exit — purpose, identity, activities, and involvement with the business (if any).

The #1 cause of post-exit regret is selling without answering "what's next?" Identity and purpose drive satisfaction — not just the number.

Critical GapFully Prepared

Question 3 of 5

I have defined my ideal exit timeline — and it is aligned with the operational and financial readiness of my business.

Buyers reward prepared sellers. A realistic timeline gives you the runway to close value gaps, not scramble to close a deal under pressure.

Critical GapFully Prepared

Question 4 of 5

My family is aligned on the exit — including any family members involved in the business, estate implications, and wealth transfer intentions.

Family misalignment is one of the most common deal disruptors. Unspoken expectations create costly surprises at the worst possible moment.

Critical GapFully Prepared

Question 5 of 5

I have evaluated multiple exit paths — strategic sale, PE recapitalization, ESOP, internal buyout, family succession — and understand the pros and cons of each.

Most owners default to the first offer. Understanding all paths creates leverage, protects value, and ensures alignment with your personal goals.

Critical GapFully Prepared

0 of 5 answered

Section 2 of 6 · Enterprise Readiness Audit™

Business Health

A healthy business commands a premium multiple. Assess the fundamental financial and operational health that buyers scrutinize first.

Question 1 of 5

My revenue is well-diversified — no single customer represents more than 15% of annual revenue.

Customer concentration is one of the most significant value suppressors in a transaction. Buyers apply steep discounts — or walk away entirely.

Critical GapFully Prepared

Question 2 of 5

My business generates significant recurring revenue — subscriptions, retainers, multi-year contracts, or predictable repeat business.

Recurring revenue dramatically increases EBITDA multiples. Buyers pay more for predictable cash flow than for one-time revenue, even at higher absolute figures.

Critical GapFully Prepared

Question 3 of 5

My EBITDA margins are stable and growing — with a clear, defensible story behind the numbers that would survive scrutiny in a quality of earnings review.

Margin instability signals operational risk. QoE reviews can erode deal value significantly when normalization reveals margin volatility that wasn't disclosed upfront.

Critical GapFully Prepared

Question 4 of 5

My financial reporting is clean, accurate, and presented in a way that a sophisticated buyer or their advisors would find credible and well-organized.

Messy financials kill deals or drag out due diligence — creating doubt and giving buyers leverage to reprice. Professional reporting signals a professionally run business.

Critical GapFully Prepared

Question 5 of 5

My business has strong, consistent cash flow generation that clearly translates EBITDA into real, distributable cash — with minimal trapped working capital.

EBITDA without cash flow is a red flag. Buyers and lenders analyze cash conversion closely. Trapped working capital becomes a negotiation lever that erodes your proceeds.

Critical GapFully Prepared

0 of 5 answered

Section 3 of 6 · Operational Dependency Index™

Owner Dependency

Owner dependency is the single largest value discount in middle-market transactions. Buyers pay for businesses that run without the founder — not for jobs in disguise.

Question 1 of 5

My business could operate effectively for 90+ days without my direct involvement — with existing leadership managing decisions, client relationships, and operations.

This is the buyer's litmus test. If the business cannot survive your absence, they're not buying a business — they're buying a job. And they'll price it accordingly.

Critical GapFully Prepared

Question 2 of 5

I have a strong, capable leadership team in place — with clear roles, authority, and the ability to retain key clients and employees post-transition.

Key employee risk is second only to owner dependency in value erosion. Buyers evaluate whether your team will stay — and whether they can lead independently.

Critical GapFully Prepared

Question 3 of 5

My business has documented, repeatable SOPs (Standard Operating Procedures) for all core functions — so that processes are not dependent on tribal knowledge.

Undocumented processes are not transferable assets. Buyers discount heavily for businesses where institutional knowledge lives in people's heads rather than systems.

Critical GapFully Prepared

Question 4 of 5

Key client relationships are held by my leadership team — not personally by me. Clients would remain post-transition without my ongoing involvement.

Owner-held client relationships are one of the most frequently cited deal risks. Buyers want assurance that revenue won't walk out the door when you do.

Critical GapFully Prepared

Question 5 of 5

I have key employee retention strategies in place — including compensation incentives, equity participation, or stay bonuses tied to a transition event.

Retention agreements protect deal value and signal to buyers that the team is committed. They also reduce the risk of leadership departures during the often-turbulent transition period.

Critical GapFully Prepared

0 of 5 answered

Section 4 of 6 · Value Gap Formula™

Value Drivers

These are the factors that directly expand or compress your EBITDA multiple. Each gap here represents real dollars left on the table in your transaction.

Question 1 of 5

My business has a clear, defensible competitive advantage — pricing power, proprietary systems, brand position, or unique capabilities that competitors cannot easily replicate.

Differentiation is the foundation of multiple expansion. Commoditized businesses trade at 3–4x. Businesses with defensible moats command 6–10x and beyond.

Critical GapFully Prepared

Question 2 of 5

My business is growing at or above the industry average — with a documented growth strategy that a buyer could continue and scale post-acquisition.

Growth rate is a primary multiple driver. A business growing at 20%+ annually commands a significantly higher multiple than a flat or declining business — even with the same current EBITDA.

Critical GapFully Prepared

Question 3 of 5

My business has mature, scalable systems and technology infrastructure — with a KPI dashboard that tracks performance metrics the leadership team acts on weekly.

Systems maturity signals scalability. Buyers and PE firms want to acquire a platform they can grow — not inherit a collection of manual workarounds that require rebuilding before scaling.

Critical GapFully Prepared

Question 4 of 5

My customer contracts are strong, transferable, and assignable — with appropriate terms, renewal provisions, and no change-of-control provisions that would threaten revenue post-transaction.

Contract transferability is frequently a deal issue discovered late in due diligence. Change-of-control clauses can give key clients the right to exit, dramatically eroding enterprise value.

Critical GapFully Prepared

Question 5 of 5

I understand my current enterprise value range — including normalized EBITDA, applicable market multiples, and the gap between my current value and my target exit value.

You can't close a gap you haven't measured. Most owners are surprised — often pleasantly — when they see their real value. The ones who aren't planned ahead. The gap is the roadmap.

Critical GapFully Prepared

0 of 5 answered

Section 5 of 6 · Strategic Exit Architecture™

Exit Preparedness

Deal readiness separates owners who command their price from those who accept whatever the market offers. These factors determine your negotiating power at the table.

Question 1 of 5

I have a coordinated team of deal advisors in place — or have identified the M&A attorney, investment banker, tax advisor, and wealth advisor I would engage for a transaction.

Most first-time sellers are outmatched by sophisticated buyers with experienced deal teams. Your advisors are your leverage. Building this team before you need it saves millions in transaction value.

Critical GapFully Prepared

Question 2 of 5

I have a tax-efficient exit structure designed — including pre-sale restructuring, trust planning, capital gains optimization, and charitable vehicles as appropriate.

Tax planning done after a deal closes is almost always too late. Pre-transaction tax strategy can save 10–20% of gross proceeds — often millions of dollars that permanently leave the table without planning.

Critical GapFully Prepared

Question 3 of 5

My business has a compelling buyer narrative — a clear strategic rationale for why a specific type of acquirer would pay a premium for what I've built.

Buyers pay for strategic fit, not just financial metrics. Understanding which buyers would compete for your business — and why — creates competitive tension that drives price and terms in your favor.

Critical GapFully Prepared

Question 4 of 5

My data room is either prepared or I could have it ready within 60 days — including 3 years of financials, legal agreements, customer contracts, IP documentation, and key employee arrangements.

Data room readiness determines deal speed and buyer confidence. Delays in due diligence kill deal momentum, create doubt, and give buyers leverage to reprice or walk. Prepared sellers close deals.

Critical GapFully Prepared

Question 5 of 5

I have a buy-sell agreement in place with my partners/co-owners (if applicable) that is current, funded, and aligned with our current enterprise value and exit intentions.

An outdated or unfunded buy-sell agreement is a legal time bomb. It can trap value, create forced sales at unfavorable terms, or trigger disputes that derail transactions entirely.

Critical GapFully Prepared

0 of 5 answered

Section 6 of 6 · Legacy Continuity System™

Legacy & Wealth Integration

For most founders, 70–90% of net worth is concentrated in the business. The transaction is only the beginning — what happens after determines the impact of a lifetime of work.

Question 1 of 5

My estate plan is current, aligned with my business value, and structured to efficiently transfer wealth — including trusts, gifting strategies, and beneficiary designations that reflect my current intentions.

An outdated estate plan can cost millions in unnecessary estate taxes and create family conflict. Pre-transaction estate planning is one of the highest-ROI activities an owner can do before a sale.

Critical GapFully Prepared

Question 2 of 5

I have a post-exit investment strategy designed — including how I will deploy, diversify, and protect the liquidity I receive from a transaction to fund my financial independence number.

Sudden liquidity without a plan is one of the most dangerous moments in a founder's financial life. Poor deployment decisions made in the first 12 months after a sale can permanently impair wealth.

Critical GapFully Prepared

Question 3 of 5

I have a clear vision for my philanthropic intentions — and have explored charitable vehicles (donor-advised funds, charitable trusts, foundations) that could enhance tax efficiency while amplifying impact.

Charitable planning before a transaction can generate substantial tax savings while creating lasting impact aligned with your values. Pre-sale charitable vehicles are among the most tax-efficient tools available.

Critical GapFully Prepared

Question 4 of 5

I have a multi-generational wealth strategy — including a family governance plan, education strategy for heirs, and a framework for responsible wealth transfer that extends beyond simple inheritance.

70% of wealth is lost by the second generation. Intentional generational planning — education, governance, values transmission — dramatically increases the probability of lasting family wealth and impact.

Critical GapFully Prepared

Question 5 of 5

My personal financial picture is diversified beyond the business — with meaningful liquid assets, retirement accounts, real estate, or other investments that reduce concentration risk.

When 80%+ of your net worth is in one illiquid asset, every business decision is distorted by financial risk. Diversification before an exit creates optionality — and allows you to negotiate from strength, not desperation.

Critical GapFully Prepared

0 of 5 answered

Exit Readiness Scorecard™

Vision & Personal Readiness

Business Health

Owner Dependency

Value Drivers

Exit Preparedness

Legacy & Wealth Integration

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