In this episode, we explore one of the most misunderstood yet critically important aspects of business ownership: planning and executing a business exit. Joined by Oliver Wadlow, Director at Alinea Corporate Finance, we explore the practical and emotional complexities that come with selling or transitioning ownership of an SME. Whether you're eyeing retirement, a strategic pivot, or simply thinking about de-risking, understanding your exit options is a must.
We discuss the full spectrum of exit routes available, from management buyouts (MBOs) and employee ownership trusts (EOTs) to trade sales and private equity. Oliver brings a wealth of real-world insight, helping demystify concepts like adjusted EBITDA, deferred consideration vs earn-outs, and the evolving landscape of tax reliefs. For many business owners, exit planning is either a distant thought or a reactive decision triggered by a postcard from a business broker. This conversation aims to help you think more proactively and make informed decisions on your own terms.
Chapters:
00:00:00 – Introduction & Why Exit Planning Matters
00:03:00 – Meet Our Guest: Oliver Watling, Alinea Corporate Finance
00:06:55 – Understanding Exit Options: MBOs, Trade Sales & EOTs
00:18:00 – Valuation Demystified: What’s Your Business Really Worth?
00:28:30 – Deal Structures & Tax Considerations
00:34:00 – Future-Proofing Your Business
00:37:45 – Wrap-Up & What’s Next
Key Topics Discussed:
- The real value of a business: sustainable EBITDA vs emotional worth
- How different exit routes work: MBOs, EOTs, trade sales, and private equity
- The pros and cons of vendor financing and how it impacts deal structure
- Common pitfalls in exit planning and how to avoid them
- Why timing, structure, and preparation matter more than you think
- Current trends in tax relief (e.g., Business Asset Disposal Relief) and their implications
- The strategic role of management teams in enhancing business value
- Factors that drive (or kill) valuation multiples across sectors
Who Is This Episode For:
This episode is designed for business owners, managing directors, and senior leaders of SMEs who are beginning to consider succession, sale, or partial exit. It’s also invaluable for finance directors, non-exec advisors, and aspiring shareholders looking to better understand how deals are structured and funded.
Quotes to Remember:
“If your business only works with you in it, you’ve got a job, not a saleable company.”
“Sustainable EBITDA is what buyers are really interested in, not one-off wins.”
“There’s no such thing as a 100% payday up front anymore. Deferred consideration is the new normal.”
Actionable Takeaways:
1) Start thinking about your exit early, even if it feels premature.
2) Ensure your business isn’t overly dependent on you: delegate, systemise, and build a strong second-tier team.
3) Understand and benchmark your EBITDA, adjusted properly for a clean valuation conversation.
4) Explore funding structures with professionals: vendor financing, bank debt, or hybrid models all have trade-offs.
5) If considering an EOT, ensure it’s properly structured with a strong management team and clear incentives for staff.
6) Don’t fall for inflated valuations or marketing hype; align your expectations with sector-specific realities.
7) Seek tax and legal advice early, structure can significantly affect your net proceeds.
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