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CompanyBrokers

How to sell a business through a broker, from first valuation to closing

Selling a privately held company usually takes 6 to 12 months and follows the same sequence whether the price is 400,000 or 4 million USD. Here is each step, who does what, and where CompanyBrokers fits in for owners, brokers and buyers.

Value my company
Laundromat and dry cleaning LOI
  • May 2 valuation, 3.4x SDE
  • May 6 listing, $880,000
  • May 12 Buyer 1057, NDA signed
  • May 15 Buyer 1057, Proof of funds
  • May 22 Buyer 1057, LOI

  1. Step 1.Value the company

    The broker recasts the last three years of earnings, adding back the owner's salary, owner benefits and one-time costs to reach SDE or adjusted EBITDA, then applies the multiple range buyers pay in the industry. On CompanyBrokers the owner gets a first range in one minute from the business valuation calculator, and the broker receives it with the match request.

  2. Step 2.Choose a broker and sign the listing agreement

    The owner compares brokers on industry experience, buyer reach, fees and the length of the exclusive listing. The listing agreement sets the success fee, any upfront fee, the term and the tail period. Owners find brokers by state and industry in the business brokers directory.

  3. Step 3.Prepare the package

    The broker writes a blind teaser and a confidential information memorandum, and the owner gathers tax returns, financial statements, the lease, staff and customer summaries into the data room. The selling a business checklist lists every document.

  4. Step 4.Market the company confidentially

    The listing goes live without the company name. Buyers see the industry, region, revenue, SDE, asking price and multiple. Deal alerts send it to buyers whose criteria match.

  5. Step 5.Qualify buyers

    Each buyer e-signs the NDA and shows proof of funds. Only then does the broker release the name, the CIM and the data room. On CompanyBrokers both steps happen before the inquiry reaches the broker's inbox.

  6. Step 6.Meet buyers and receive offers

    Serious buyers ask questions, visit the company after hours and meet the owner. Offers arrive as letters of intent with price, structure, financing, transition period and an exclusivity window.

  7. Step 7.Due diligence and financing

    The chosen buyer and their lender verify the financials, contracts, licenses and assets. SBA lenders order a business valuation and review the buyer's experience and liquidity. This stage commonly takes 45 to 90 days.

  8. Step 8.Purchase agreement and closing

    Attorneys draft the asset or stock purchase agreement, the landlord consents to the lease assignment, licenses transfer, and funds move at closing. The broker's success fee is paid from the proceeds.

  9. Step 9.Transition

    The seller trains the new owner for an agreed period, often 30 to 90 days, and introduces key customers, suppliers and staff.

Who does what

StageOwnerBrokerBuyer
Valuation Provides financials Recasts earnings and prices None
Marketing Approves the listing Writes the teaser and CIM Sets deal alerts
Qualification Approves buyers Collects NDA and proof of funds Signs the NDA, shows funds
Offers Chooses the LOI Negotiates terms Submits the LOI
Diligence Answers questions Runs the timeline Verifies with lender and advisors
Closing Signs and trains Coordinates Funds and takes over

What happens on CompanyBrokers at each step

  • Valuation in one minute with the multiple and method shown
  • Matching with brokers who work your state, industry and deal size
  • Blind listings with structured financials
  • NDA e-sign and proof of funds on every inquiry
  • Data rooms with permissions, watermarking and an audit log
  • Buyer CRM from inquiry to closing for the broker
Value my company

How long each stage takes

  • Preparation and valuation, 2 to 6 weeks
  • Marketing and buyer meetings, 2 to 6 months
  • Due diligence and financing, 45 to 90 days
  • Closing and transition, 1 to 3 months

Selling without a broker

Owners who sell by themselves follow the same steps and do the broker's part themselves. See businesses for sale by owner and the longer guide how to sell my business.

How much does it cost to sell through a broker

Main Street brokers commonly charge 8 to 12% of the sale price at closing, often with a minimum fee. See business broker fees.

Can I keep running the company while it is for sale

Yes, and you should. Buyers pay for current results, and a drop in revenue during the sale is the most common reason a price is renegotiated.

When should I tell my employees

Usually after an LOI is signed and due diligence is well underway, often close to closing. Key managers sometimes learn earlier, under a stay bonus agreement.