Most of the value lost in a company sale is not lost negotiating the price. It is lost before, in preparation, and after, in the contract terms. The mistakes that most often cost sellers dearly, and how to avoid them.
An owner sells their company once in a lifetime. The buyer has often bought several. This gap in experience explains why so many sellers leave value on the table — not for lack of negotiating skill, but because of mistakes that only become visible afterwards.
1. Selling unprepared
Coming to market with messy accounts, personal costs mixed in and unresolved contingencies gives the buyer reasons to cut the price and demand protection. Preparation — ideally twelve to eighteen months ahead — has the best return of the whole process.
2. Negotiating with a single buyer
Many sales start with an unsolicited approach, and the flattered seller negotiates only with that party. Without alternatives, there is no way to know if the price is good, nor leverage to improve it. Competition between buyers, organised discreetly, is the main driver of price.
3. Disclosing too much, too early
Sending detailed accounts, customer lists and margins to someone who has not signed an NDA — or to a competitor who may only be gathering intelligence — is a serious risk. Information should be released in stages as buyer interest is confirmed.
4. Letting the business slow down during the process
A sale consumes management time. If results dip during those months, the buyer uses it to renegotiate. Keeping the business at full speed is part of the sale strategy — and one of the main reasons to delegate the process to an adviser.
5. Focusing only on headline price
A higher offer can be worth less than a lower one if it carries more deferred payment, a hard-to-reach earn-out or heavier warranties. Offers should be compared on what the seller will actually receive, with what certainty, and when.
6. Accepting uncapped warranties
In the contract, the seller warrants that the company is as presented and is liable if not. Without caps on amount and time and a de minimis threshold, warranties can turn a good sale into an open-ended risk for years. Negotiating these limits matters as much as negotiating price.
7. Forgetting tax
The form of sale — shares or assets, personally or through a holding — and its timing can significantly change the tax bill. Planning with tax advisers before the sale, not after, can make a material difference to net proceeds.
8. Not thinking about the day after
Many founders stay on during a transition. Without agreeing role, duration, pay and autonomy upfront, the post-sale period becomes frustrating for both sides. And without a plan for the proceeds, the liquidity can be poorly deployed.
How to avoid these mistakes
Most of them share one cause: the seller runs the process alone while running the company, with no transaction experience. An adviser who leads preparation, creates competition between buyers, controls information and negotiates the contract alongside the lawyers exists precisely to avoid them.
GestInvest runs founder-led company sales across Europe, from first step to completion. See how a business sale works or read our step-by-step guide on how to sell a business.
Frequently asked questions
What is the most common mistake?
Negotiating with a single buyer. It limits both price and terms more than anything else.
How far ahead should I start preparing?
Ideally twelve to eighteen months before going to market, to allow time to fix what lowers value.
Are adviser fees worth it?
In mid-sized deals, the difference in price and terms between a run process and a reactive sale usually exceeds the fees.
