To sell your business on your terms, you must start with organization. That includes more than clean books. It means preparing your business—and yourself—for valuation, negotiation, and transition. The best way to do that? A customized exit readiness checklist.
At Approach Advisors, we help financial services owners align their metrics, documents, and contingency plans. We turn complexity into clarity. Because when your assets are ready, your exit is stronger.
Know Your EBITDA—and Why It Matters
EBITDA tells your story. It shows what your business earns before interest, taxes, depreciation, and amortization. But many owners confuse profit with revenue. That’s a costly mistake.
Use your exit readiness checklist to:
- Clarify your EBITDA trends over 3–5 years
- Normalize one-time expenses to show true earning power
- Compare EBITDA multiples for your industry
EBITDA is what buyers buy. Organizing business assets begins by making this number real and defensible.
Revenue ≠ Profit: Know the Difference
A $6M revenue business doesn’t mean a $6M valuation. Buyers care about what you keep, not just what you make.
Make sure your documentation:
- Separates gross revenue from net operating profit
- Highlights margins across services or client groups
- Removes personal or one-off expenses from financials
This step shows transparency. And it helps your advisor price the business appropriately.
Prepare for Contingencies: Be Ready for the Unexpected
Illness, partner disputes, or sudden shifts can force an unplanned exit. That’s why financial readiness isn’t optional.
To prepare:
- Create or update your buy-sell agreements
- Fund and document key person insurance
- Outline succession plans for leadership roles
These items make it into every good exit readiness checklist. They protect your value and your family’s future.
Tie It All Together with Clear Documentation
To make decisions quickly, buyers need clarity. That means more than financial statements. It means:
- Up-to-date business exit documentation
- Logical folders for P&Ls, contracts, and tax returns
- A narrative that supports your valuation
When we advise clients, we build this framework with them. And we coordinate with their CPAs, attorneys, and partners to ensure nothing’s missed.