The Deal Leader
June 2026 | Volume 61
Know the risks that can cost you millions when selling your business.
Selling a business is one of the most important financial decisions an owner will ever make. Yet many of the biggest risks don’t come from market conditions or a lack of buyer interest. They come from decisions made before a deal is signed.
This month, we’re highlighting some of the hidden risks that can cost business owners significant value during the sale process.
We start by examining four red flags every seller should understand before signing an M&A advisor agreement, from restrictive lock-ins to promises that sound too good to be true.
We then explore why selling a business is nothing like selling a property, and why approaches that work in residential real estate can leave business owners exposed to poor outcomes.
In our feature article, DLI Deal Executive Taryn Henkel shares the story of one of our recent deals, in which a business owner who had spent years trying to sell independently finally achieved success through having the right guidance.
Finally, we invite you to join our upcoming Masterclass webinar in Navigating the Minefield of Selling Your Business, in association with Engineering News and Creamer Media Webinars.
Understanding M&A Advisor Agreements Before You Sign
The M&A advisor you choose deserves careful scrutiny. Before signing an advisory agreement, it pays to understand which terms and tactics should raise questions.
Here are four red flags every business owner should be aware of.
The "I have a buyer in your Sector" approach
One of the most common approaches business owners encounter is a phone call or email from someone claiming to have a buyer interested in businesses in their sector.
It sounds appealing. After all, if the buyer already exists, surely the process becomes quicker and easier? Unfortunately, successful transactions rarely work that way.
A genuine sell-side advisor is not hired because they know one buyer. They are hired because they know how to create real deal heat and a competitive environment for offers. The goal is not to secure an offer; it is to secure the best possible outcome. Those are very different things.
When only one buyer is involved, the seller has limited leverage. The buyer largely controls the negotiation, the terms and often the valuation. A structured process that engages multiple qualified buyers creates competitive tension, improves negotiating power and leads to stronger outcomes.
Don't sign with an advisor who cold-calls or emails you, claiming they already have a buyer in your sector.
Be cautious of lock-ins
Be cautious of long lock-in periods that prevent you from exploring alternative options. A lock-in commits you to one advisor, typically for an open-ended term, so you need to understand exactly what you are agreeing to before that clock starts.
The implication of a long lock-in is that you lose your most important source of leverage: the ability to walk away. If an advisor underperforms — fails to generate buyer interest, goes quiet for months, or pushes you towards a deal that doesn't serve you — a lengthy exclusivity period leaves you with little recourse. You can't take your business to a more capable advisor, and the one you're tied to knows it. That imbalance can quietly shift the relationship from one in which the advisor has to earn your continued confidence to one in which they're guaranteed their position regardless of results.
It’s important to note that a lock-in is not inherently unreasonable. Advisors invest real time and money upfront and need some assurance they won't be cut out the moment there’s buyer interest. But the term should be proportionate, and you should be confident in the advisor before committing to it. A reasonable exclusivity period agreed with a capable advisor, or a simple termination process, is very different from a long, restrictive one signed before you understand how they actually work.
Don't sign anything with a lock-in before you understand the full process.
Be wary of guaranteed-sale promises
Be wary of any advisor who promises they will sell your business. It's a reassuring thing to hear, especially when selling feels daunting, but it doesn't reflect how transactions actually work.
The reality is that no advisor can guarantee a sale. An advisor who acknowledges this is being honest. That honesty is itself a good sign, because it tells you they will manage the process realistically rather than tell you what you want to hear.
A guarantee, by contrast, is often a sales tactic. Once you've signed, committed to a lock-in and perhaps paid an upfront fee, the advisor has far less incentive to deliver on a promise that was never enforceable in the first place.
So when an advisor projects certainty, test it. Ask to see their track record: how many businesses like yours they have actually sold, over what timeframe, and at what kind of outcome relative to expectations. Ask how buyers will be identified and how they intend to create competitive tension across multiple parties. A credible advisor will answer with specifics and evidence.
Be wary of target valuations
Many advisors will want you to agree on a target value for your business, and then include in their conditions that if they achieve an offer to this value (which you agreed to), their full fee is due. NEVER agree to this. The major flaw here is that value is often not the reason to reject an offer. In many cases, structure is much more of an issue. Also, you may not trust the acquirer based on something they said or did.
In summary, you should only pay the full success fee on conclusion of a deal that you are happy with. There may be milestone or other fees on the way, which should be a reasonable reflection of milestones achieved, but the idea of paying a fee on the basis of a rejected offer would never be reasonable.
Why Selling a Business is Nothing Like Selling a House
Rick Grantham, DLI Joint Chief Executive
Many business owners assume that selling a business works much like selling a property. Appoint an advisor, put a value on the asset, advertise it to the market and wait for offers to arrive. And of course, those offers are typically binding, so once you select an offer, there is a defined route to concluding the deal.
In reality, selling a business is nothing like selling a house.
In this article, DLI Joint Chief Executive, Rick Grantham, explores why business owners should be cautious of advisors who treat a business sale like a property transaction, and why creating competition among the right buyers is often the difference between an average outcome and an exceptional one.
FEATURE ARTICLE
Getting The Deal Over The Line: Why Trusted M&A Advice Matters
Taryn Henkel, DLI Deal Executive
In this month's feature article, DLI Deal Executive Taryn Henkel shares the story of a business owner who had spent years trying to sell their company independently, receiving multiple offers and even reaching due diligence, only to see transactions repeatedly collapse. What ultimately changed was not the quality of the business or the level of buyer interest. It was having experienced M&A guidance to navigate deal structure, buyer behaviour, negotiations and the inevitable challenges that arise between offer and completion.
The article highlights why successful exits are rarely determined by valuation alone and why trusted advice can make the difference between years of frustration and a completed transaction. Read the full article to discover why finding a buyer is often only the beginning of the journey.
Join DLI’s Andrew Bahlmann and Rick Grantham for practical insights into what acquirers are really looking for, why the right acquirer matters and how preparation can maximise value.
Date: 21 July 2026 at 14h00.
The strongest transactions are rarely the easiest transactions. Successful outcomes depend on preparation, process and having the right people around the table.
At DLI, we believe business owners deserve more than a buyer. They deserve options, clarity and expert guidance that helps them maximise value while protecting their future. Because when it comes to selling your life's work, getting the deal over the line is about far more than reaching an agreement. It's about achieving the right outcome.
Thinking about selling your business in the next one to five years? Contact DLI for a discovery call with one of our M&A advisors to discuss your options.
Warm regards,
Rick, Andrew and the DLI Team