An advisor with expertise in exit planning can play a critical role in preparing a business owner for an effective transition — whether the change is planned or not. Exiting a business may take the form of a sale or planned handover to a younger generation, or it can result more suddenly due to a divorce or death. Whatever the circumstances, the advisor is responsible for helping a business owner identify and eliminate risk and maximize the value of a business prior to the owner's exit. By offering an outside perspective and serving as a leader and a partner, an advisor can help make the process as smooth and successful as possible for business owners.

Offer an Outside Perspective

While owners are the experts when it comes to their own business, an external perspective can be very valuable. An advisor can highlight areas of potential risk and opportunity that could have a significant impact on the business's market value or the business owner's future.

Perhaps one of the most important steps in the process is determining the value of the company, and an advisor can provide context to help business owners assess the overall state of the marketplace. Encouraging business owners to look beyond just the growth of their company, and factor in industry trends and the broader economic climate, will give them an idea of what might impact the future sale of their business. Consulting with tax professionals and obtaining an informal valuation of the business are also important parts of the preparation. A trusted advisor can guide the business owner through all of these steps.

Because advisors approach the business with fresh eyes, they can also identify issues that the owner may not have considered. For example, the owners may not be thinking about their estate planning needs yet, or the intricacies of transferring the business to their children or grandchildren. The advisor should also raise the possibility of an involuntary transition. If circumstances arise that require the business owner to exit the business earlier than planned, it's important to consider how that would be handled.

And, last but not least, proper documentation cannot be overlooked. When preparing a business for a transition, it's essential to encourage business owners to review all the important documents of the business (e.g., financial records, equity ownership records, etc.) and ensure they are organized and safeguarded.

Provide a Reliable Source of Leadership

While preparing for a sale or other exit, the owner must also stay focused on running a successful company. That's where an advisor can step in to lead the exit planning process, freeing the owner to concentrate on their day-to-day obligations.

Helping the business owner assemble the right team, based on the owner's circumstances and goals, is a key leadership opportunity for an advisor. The owner will likely already be working with certain professionals, such as a CPA, an insurance agent or a wealth manager. Suggesting the addition of an estate planning attorney and business attorney will help round out this lineup.

In addition, it's important for one advisor to provide oversight to the general team, helping to manage the larger project of preparing a transition or exit plan. With so many individuals with varying areas of expertise and advice, having one advisor to lead the group, coordinate all efforts, prioritize actions and resolve any potential conflicts is invaluable.

Serve as a Long-Term Partner

Once the transition of the business is complete, that doesn't mean the owner is no longer in need of support and advice. Part of business transition planning includes the phase after ownership, determining likely scenarios and making adjustments as assumptions about the future become reality. At this point, the advisor might evolve into the role of a long-term partner, aiding the former owner in adapting to new circumstances.

This might include referring the former owner to a wealth manager, if one is not already in place, to provide guidance as the value of a business is converted from equity to liquid and investable assets. If the former owner is interested in getting involved in a new venture or opportunity, the advisor can also connect him or her to recruiters, or to networking opportunities for boards of companies or non-profits. Finally, with a business transition may come lifestyle adjustments, such as having more time available to pursue personal or family interests. Here, a reference to a life coach may help facilitate this dynamic shift.


The transition out of an ownership position can have significant impacts over many areas of a business owner's life — from financial and estate plans, to how he or she spends time and energy each day. An effective advisor will provide insight and support in each of these areas, helping to anticipate and plan for all forms of business transition.

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