OnwardLesson 4.2
How much of this business is you
Buyers worry most about value that leaves when you do.
The short version
- Buyers worry most about value that leaves when you do.
- The more the business depends on you personally, the lower the price and the harder the terms.
- A simple test: could the business run for a month without you?
- Reducing your role takes time, which is why it starts well before a sale.
Why it matters
A buyer pays for earnings they expect to keep. If customers call you, not the business, some of them may leave with you. If only you can estimate jobs, price work or fix the hard problems, the buyer is paying for something that walks out the door at closing.
Buyers price that risk. They offer less, or they ask you to carry more of the risk yourself.
The month-away test
Ask yourself honestly: could the business run for a month without you?
- Never. Customers, crews or suppliers would be stuck within days.
- Mostly. Most work continues, but some decisions wait for you.
- Yes. The business runs, and you catch up when you return.
Buyers ask a version of this question in almost every sale.
Where dependence hides
- Customer relationships. Your largest customers know you, not your team.
- Pricing and estimating. The numbers live in your head.
- Licenses and certifications. The business operates under a license held in your name.
- Supplier terms. Credit and pricing rest on your personal relationship.
- Key skills. You are the only one who can do certain work.
- Decisions. Nothing important happens without you.
How buyers respond to it
When a business depends heavily on its owner, buyers often:
- Offer a lower multiple.
- Ask you to stay on longer after closing to transfer relationships.
- Ask you to carry part of the price as a note, so you share the risk.
- Look harder at customer retention during due diligence.
For buyers using an SBA loan, rules effective October 1, 2026 allow a seller to stay on as a consultant for up to 24 months. That gives time to hand over relationships.
What helps
The fixes are covered in Lesson 5.5, Making the business run without you. They include putting other people in front of customers, writing down how work gets done and moving licenses into the business where your state allows. Most take a year or more to show up in the numbers.
When you are ready to talk to someone
Nobody needs to know you read this. When you are ready, these are the questions to bring.
- For a broker or valuation professional: "How dependent on me would a buyer see this business, and what would they discount for it?" Listen for: specific areas of dependence, not a general comment.
- For your M&A attorney: "Which licenses or permits are in my name, and can any of them move to the business before a sale?" Listen for: a list, with what your state allows for each.
- For your key employees: "If I were away for a month, where would you get stuck?" Listen for: honest answers. They are your to-do list.
This names the question. Your CPA, your M&A attorney and your lender answer it for your situation.
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