Common Exit Planning Myths That Cost Owners Millions

Myth #1: “I’ll Just Sell When I’m Ready.”

Why it’s wrong: Buyers don’t appear overnight—and businesses don’t sell themselves. According to Entrepreneur, it can take 6–12 months or more to sell a small business, and many listings never close because the business wasn’t truly ready.

What to understand instead:A business that runs without you, has clean books, and offers future growth potential is far more sellable—and valuable. Waiting until you’re “ready” may leave you scrambling to fix problems you could’ve addressed years earlier.

Action steps:

• Start preparing 3–5 years before your ideal exit date.

• Get a business valuation to understand your current position.

• Create systems and delegate tasks to reduce owner dependency.

Myth #2: “My Business Is Worth What I Need It to Be.”

Why it’s wrong: Valuation isn’t based on your retirement number or your gut feeling. It’s based on the business’s cash flow, risk profile, and market demand. Overpricing your business can drive away serious buyers.

What to understand instead:Value is determined by what a qualified buyer is willing to pay—backed by data. That means earnings, customer concentration, industry trends, and deal structure all factor in.

Action steps:

• Use a qualified valuation expert—not a rule of thumb.

• Improve your financial performance and reduce risk factors.

• Focus on growing transferable value, not just revenue.

Myth #3: “My Accountant or Lawyer Will Handle Everything.”

Why it’s wrong: Accountants and attorneys play vital roles—but exit planning is a strategic, multi-phase process that goes beyond tax filings or legal documents. Assuming they’ll manage the whole process often leads to gaps in valuation, deal structuring, and timing.

What to understand instead:You need a coordinated team: valuation expert, tax strategist, attorney, and financial advisor—ideally led by someone who specializes in exit planning.

Action steps:

• Hire or consult with a certified exit planning advisor (CEPA) or similar expert.

• Ask your current professionals if they’ve handled business exits before.

• Use our Exit Planning service to create a comprehensive roadmap.

Myth #4: “I’ll Just Pass It to My Kids.”

Why it’s wrong: Passing a business to family is rarely simple. Your children may not want the business, may not be ready, or may not qualify for financing. Without a clear plan, family transitions often lead to conflict, failure, or unintended tax consequences.

What to understand instead:Succession requires years of planning—including leadership development, financing structure, and estate coordination.

Action steps:

• Talk to your children early about interest and readiness.

• Explore gifting, installment sales, or buy-sell agreements.

• Involve a tax advisor to navigate complex IRS rules (see IRS Section 6166 or consult Entrepreneur for real-world family transfer scenarios).

Final Thoughts: Common Exit Planning Myths

Exit myths aren’t just harmless misunderstandings—they can lead to millions in lost value, avoidable taxes, or failed transitions. Small business owners who succeed at exiting don’t wait until the last minute or go it alone.

Want help separating fact from fiction? Explore our Exit Planning services to get a clear plan tailored to your business and goals.