Exit preparation for founders is the work done before a sale is on the table. It starts with a personal decision about what you want after the exit. It keeps more than one route to a sale open, and it builds relationships with likely buyers early, while there is no pressure to sell.
What does exit preparation mean for a founder?
Exit preparation is the work a founder does before a sale is on the table. It covers three things: a clear personal answer to what you want after the sale, more than one realistic route to a sale, and early relationships with the buyers who could own your company one day.
Zoé Fabian-Frey is General Partner and co-founder of Noteus Partners, an independent European growth investor. In my CEO Briefing on her interview on my DEALMACHER podcast, she describes exit preparation as something that starts with the founder, long before any buyer calls.
Which personal question should a founder answer before an exit?
The first question is what role you want after the sale. Zoé asks founders to settle it before they talk about price or buyers:
- Do I want to be the CEO of a listed company?
- Do I want to hand over the company?
- Do I want to sell to private equity?
- Could I see myself working inside a strategic buyer, meaning a company that buys yours to add it to its own business?
“Nothing is harder than when your own attitude doesn’t fit the exit plan.”
The answer decides which partners fit. A founder who wants freedom to invest in growth and product may struggle with a private equity owner.
Zoé is equally direct about founders who have run out of energy after hard years. Saying “this far and no further” is not a problem for her. A founder can look for an exit, run a profitable company, or bring in external management and move into a chair role. It only becomes difficult when someone promises what they cannot deliver.
Why should a founder keep more than one route to an exit open?
A second credible option gives the founder freedom in the decision. Zoé calls this optionality, and she names it as her biggest learning from the investor side: the best outcome needs more than one route open.
The sale of Tink shows how this works. Tink is a Swedish company that Zoé's team identified in 2020 as the pan-European leader in open banking. When Visa showed interest in buying Tink, the board had to decide. At the same time, a very active hedge fund had put an alternative term sheet on the table, a written offer with the key terms of a deal. In Zoé's words, it gave the founders “mental freedom”: they knew they did not have to take Visa's offer.
Tink went to Visa six months after Zoé's team had invested. The sale closed in 2021, before the tech market turned in 2022 and 2023.
When should a founder start talking to potential buyers?
Early, and ideally while there is no pressure to sell. The less urgency you have, the better the dynamic in these conversations.
Some buyers start even earlier. Christoph Jost is Founder and Managing Partner at Flex Capital, a private equity firm that has bought twelve platform companies in DACH (Germany, Austria and Switzerland) and made twelve add-on acquisitions, meaning further companies bought to join them. As my CEO Briefing on his interview on my DEALMACHER podcast describes, Flex runs a proprietary tool with six people working on it full-time. It flags signals that a founder might be ready to sell:
- a change in managing director
- a founder reaching their late fifties
- revenue that has stayed flat for two years in a row
- no senior hire in eighteen months
These data points are public. A disciplined buyer reads them systematically while the founder is busy running the company.
Christoph offers founders who reach out early an honest assessment of fit. If the company is not a match for Flex, he gives them three or four names of firms that are looking for exactly that profile. The founder who came back two years after a first conversation is the one he already trusts: less risk, a faster process and a higher probability of closing.
Investors think about this too. At Noteus, every deal gets a second partner who did not do the deal. Part of that partner's job is to think about the exit early: which strategic buyers should hear about the product roadmap today, so they understand early why the company matters to them.
How do you make your company relevant to a strategic buyer?
You position the company as the answer to a gap in the buyer's own product range. Mani Pirouz, Head of Business Transformation Management at the German software company SAP, explained in my CEO Briefing on SAP's acquisitions that SAP starts every strategic acquisition by asking where the white spaces in its portfolio are.
Founders can prepare for that question in four ways:
- Map the company to strategic themes: position the product as the enabler of a shift that buyers care about, beyond being faster or cheaper.
- Watch when your space becomes critical: LeanIX started working with SAP years before enterprise architecture became urgent. When SAP was ready to buy, LeanIX was already embedded.
- Build partnerships that could become pipelines: the companies SAP bought were already customers or sales partners.
- Think like the buyer: ask why the buyer would not build the product itself or simply partner with you. The goal is to make buying the obvious call.
Should you sell through a competitive process or to one buyer?
It depends on what matters most to you: the highest price, or certainty and speed. A competitive process with several bidders will usually drive a higher valuation.
A proprietary deal, where the buyer talks only to you and you talk only to that buyer, tends to close faster, with less friction and a significantly higher probability of completing. The buyer has built conviction over months or years, has done half of its checks informally and trusts what you say. A founder who enters a sale cold, through a banker, under time pressure and with no prior relationship, negotiates from a weaker position.
The trade-off is real. It is worth understanding before you hire a banker.
What are the first steps of exit preparation for founders?
- Answer the personal question: decide what role you want after the sale, and which buyer types fit that answer.
- Keep a second route open: a profitable company, another buyer or a new investor all give you freedom in the final decision.
- Talk to two or three private equity firms active in your space: without pitching, to learn what they look for and whether your company is on a path they would want to own.
- Make yourself relevant to strategic buyers: as customer, partner or co-seller, long before any acquisition talk.
- Decide on the sale process: choose between maximum price in a competitive process and speed and certainty with one buyer, before you hire a banker.
“The buyer who already knows your business will pay more for it – because they’re not pricing in the unknown.”
Frequently asked questions
When should a founder start preparing for an exit?
Long before a sale is planned. Investors such as Noteus think about the exit early, and buyers such as Flex Capital track companies for years, so conversations started without urgency give the founder the better position.
Is it a problem to sell because I have run out of energy?
Not for Zoé Fabian-Frey of Noteus Partners. A founder can look for an exit, run a profitable company or bring in external management, and it only becomes difficult when someone promises what they cannot deliver.
Is a private equity buyer right for every founder?
It depends on what you want after the sale. A founder who wants freedom to invest in growth and product may struggle with a private equity owner, so the personal question comes before the choice of buyer.
Do I need an advisor to prepare an exit?
Hiring an M&A advisor (mergers and acquisitions) late, or waiting until you are exhausted, often leaves the information advantage with the buyer. What helps is early preparation: your own buyer relationships and a clear view on the trade-off between a competitive sale and one buyer. See how my exit advisory works.
