Inspired by my recent conversation with Kerry Lutz on the Financial Survival Network Podcast “Build Value And Master Your Exit” Episode #6251

 

The Journey Beyond Your Business

After working with business owners for four decades and owning my own firm for 25 years, I’ve witnessed good, bad, and ugly transitions and exits. One pattern stands out clearly: those who design their exit proactively achieve satisfying outcomes, while those who leave it to chance often experience regret.

“People that aren’t proactive end up exiting by default,” I often tell my clients. “And that’s when something in that transaction usually leads to regret.”

Why Most Business Exits Fall Short

Throughout my years helping business owners, I’ve noticed a significant gap in the planning process. Many owners work with various advisors—accountants, attorneys, financial planners—but these professionals typically operate in silos. The result is fragmented, sometimes conflicting advice that can undermine the owner’s true goals.

This observation led me to develop a more unified approach. The most successful exits don’t happen by chance—they’re carefully orchestrated with strategies that align all aspects of the transition, from business valuation to personal fulfillment after the sale.

Three Critical Mistakes to Avoid When Selling Your Business

1. Failing to Plan Your “Next Act”

One of the biggest challenges I see is business owners not determining their personal plans before selling. After dedicating decades to building a business—your “baby” and a core part of your identity—stepping away creates significant emotional and psychological hurdles.

I recommend creating what I call a “personal action plan” that maps out your next chapter in life. This isn’t just about deciding where you’ll live, but envisioning what will give your life meaning and purpose after the sale.

“What’s your life really going to look like, where you could still have meaning and purpose?” I ask clients to consider. For owners who’ve spent 20, 30, or 40 years nurturing their companies, this transition requires thoughtful planning, not just financial calculations.

2. Not Knowing Your “Freedom Point”

Another common oversight is failing to determine what I call your “freedom point”—having enough money to live your ideal life without financial constraints.

In my practice, we develop a “lifetime cash flow plan.” This shows exactly what you need from the business sale, combined with other accumulated assets, to secure your financial freedom.

Many owners rely on back-of-the-envelope calculations that fail to account for all variables in post-business life. A comprehensive cash flow plan creates clarity around exactly what number you need to reach during the exit.

3. Misunderstanding What Makes Your Business Valuable

Perhaps most critically, many owners don’t understand the readiness and attractiveness of their business from a buyer’s perspective. The metrics buyers use to evaluate your business often differ significantly from how you measure success.

Key factors buyers evaluate include:

• Owner dependence: “If you’re going to step away from the business and a new owner is going to step in, if it’s very dependent on you, it’s not very valuable to them,” I explain to clients considering a sale.
• Competitive advantage: The stronger your competitive edge, the more valuable your business becomes to potential buyers.
• Recurring revenue streams: These are particularly valuable compared to businesses that “start at zero every year.”

These factors directly impact your business valuation. Poor metrics result in lower multiples of earnings, while strong performance in these areas can significantly increase your company’s worth.

Designing Your Ideal Exit

The range of exit options has expanded considerably in today’s market. Depending on your business size and structure, possibilities include:

• Transitioning to key employees or management teams
• Family succession planning
• Sale to another private owner (common for businesses valued under $5 million)
• Sale to industry consolidators
• Strategic buyer acquisition
• Private equity investment

Each path offers distinct advantages and challenges, highlighting why a coordinated strategy matters more than ever.

Taking the First Step

The journey to a successful business exit begins with education and planning. In my experience, the earlier you start designing your exit, the more options you’ll have and the better your outcomes will be—both financially and personally.

I wrote “Exit by Design” to help business owners navigate this complex but rewarding journey. Having guided many owners through this process, I’ve seen firsthand how proper planning transforms not just the financial outcome, but the emotional satisfaction of transitioning from the business you’ve built.

Ready to start planning your optimal business exit?

Schedule a no-obligation, exploratory call with me. We’ll delve into your business specifics and long-term goals, formulating strategies to build and protect your wealth as you prepare for your ideal business endgame.

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Joseph LoPresti, leads  Arlington Wealth Management, and brings over 39 years of wealth management and business expertise to the table. Joseph is passionate about guiding fellow business owners  through a smooth and satisfying transition, and coordinating all aspects of their wealth toward a secure and prosperous life.

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