Selling your business is one of the most significant financial and personal decisions you’ll ever make. To achieve the best outcome, it’s essential to understand what buyers are really looking for.
By thinking like a buyer, you can position your business to be more attractive and ultimately secure a better deal.
Of course, not all buyers are the same. Strategic buyers, private equity investors, and management buy-ins all have different motivations – and different criteria. Knowing what matters to each can help you prepare and negotiate effectively.
Stable and Predictable Cash Flow
In an unpredictable world, buyers want just one thing (above all else) – certainty. When it comes to your business, what that means is solid, predictable, recurring revenue streams.
What buyers want:
- Consistent year-on-year revenue and profit growth.
- Low volatility in cash flow.
- Strong customer payment discipline.
Tip: Strengthen recurring income streams and lock in longer-term contracts where possible.
Scalable Operations
Buyers pay more for businesses that can grow without needing massive additional investment.
What buyers want:
- Systems and processes that scale easily.
- Capacity for growth without major new hires or infrastructure.
- Low reliance on key individuals.
Tip: Document your systems and build a management team that can run the business without you.
A Diversified Customer Base
Customer concentration is a massive red flag. A heavy reliance on a small number of clients typically increases perceived risk.
What buyers want:
- No single customer representing more than 15-20% of revenue.
- Diverse industries and geographies (where possible)
Tip: Proactively broaden your client base in the years leading up to a sale.
Strong Management Team
Most buyers aren’t looking to buy themselves a job. They want an operational team that can run the business day-to-day.
What buyers want:
- Experienced second-tier leadership.
- Clear succession plans.
Tip: Start stepping back from daily operations at least 12–24 months before you sell.
Clean Legal and Financial Records
Buyers will scrutinise every contract, employee agreement, and financial statement.
What buyers want:
- Clear ownership of intellectual property.
- Up-to-date compliance with employment, safety, and tax laws.
- Audited or reviewed financials.
Tip: Conduct a “vendor due diligence” review before going to market.
Strong Competitive Position
Buyers want businesses that are leaders, not followers.
What buyers want:
- Defensible market share.
- Differentiated products, services, or brand positioning.
- Clear competitive advantages.
Tip: Invest in marketing and brand building before selling.
Low Dependence on the Current Owner
If the business depends on you personally, buyers will discount the price – or walk away.
What buyers want:
- Minimal reliance on the founder.
- Transition plans or handover assistance.
Tip: Train your team and empower them to make decisions well before the sale process starts.
Clear Growth Opportunities
Buyers aren’t just buying what exists today – they’re buying tomorrow’s potential.
What buyers want:
- New markets or customer segments to expand into.
- Cross-sell or upsell opportunities.
- Operational efficiencies that can boost margins.
Tip: Map out a realistic 3–5 year growth strategy to share with buyers.
Different Types of Buyers: What Each Values Most
Strategic Buyers
Typically larger companies looking for synergies. They often pay the highest multiples because they see strategic value.
- What they value: Synergies, new markets, products that complement their existing business.
- Watch out for: Cultural fit and integration challenges.
Private Equity (Financial Buyers)
Professional investors looking to buy, grow, and eventually sell the business.
- What they value: Strong cash flow, scalable operations, and a leadership team that can stay on post-deal.
- Watch out for: Performance hurdles, earn-outs, and aggressive financial structures
Management Buy-Ins/Management Buy-Outs (MBIs/MBOs)
Internal managers or external executives looking to take over.
- What they value: Stability, clear ownership structure, and an opportunity to grow the business.
- Watch out for: Ability to secure financing and transition risk.
Conclusion
Selling your business is about more than just hitting a revenue target. By understanding what buyers are looking for – and positioning your business accordingly – you can significantly increase its value and make the sale process smoother and faster.
At Qurate, we help business owners prepare not just for a sale, but for the best possible sale: one that recognises the true value they’ve built and unlocks a future they can be proud of.
The information on this website is general in nature and is not intended to constitute financial, legal, or tax advice. It does not take into account your objectives, financial situation, or needs. You should seek appropriate professional advice before acting on any content. While we draw on our experience as business owners and corporate advisors, our insights are not a substitute for tailored advice.
