Business owners are accustomed to reading signals. They track market trends, watch competitors, and respond to shifts in customer demand. Over time, many come to believe that the right moment to exit a business will reveal itself just as clearly.
“I’ll know when the time is right,” is a reassuring idea. It’s also one of the most expensive assumptions an owner can make. In practice, timing rarely announces itself. And by the time clarity arrives, options are often already gone.
The Illusion of Future Certainty
Most business owners are not ignoring the idea of an eventual exit. For example, among lower middle market business owners age 45 to 75, nearly half (48%) expect to sell within the next three years, almost two-thirds (64%) within five years, and more than 80% in the next decade, according to Cornerstone’s Selling Your Business study.
So the disconnect isn’t intention. It’s preparation.
Only about one-third (34%) of owners in the study have taken any formal steps to plan for a sale. Many assume that preparation can wait until the timing feels obvious. That the market will cooperate, conditions will line up, and they’ll recognize the moment when it arrives.
What that belief overlooks is a simple reality: Timing is rarely chosen. It’s imposed.
When Waiting Costs Leverage
Businesses don’t operate in a vacuum. Health events happen, partnerships change, industries consolidate, access to capital tightens, and competitive landscapes shift faster than expected.
In exit planning circles, these unplanned forces are often grouped into the 5 D’s: death, disability, divorce, distress, and disagreement. According to the Exit Planning Institute® (EPI), roughly half of business exits are driven by one of these events rather than by a deliberate, well-timed decision.
When an exit is forced, leverage disappears. Buyers sense urgency, options narrow, and deal structures become less favorable. Value that took decades to build can erode quickly, not because the business failed, but because the owner waited too long to prepare.
The gap between intention and preparation is where leverage quietly slips away.
The risk is magnified by how much is at stake. According to estimates from EPI, roughly 80%-90% of a business owner’s net worth is tied up in their company. Cornerstone’s study reinforces the emotional weight of that concentration: 47% of owners reported losing sleep in the past month because they believe too much of their net worth is locked inside the business.
When so much personal wealth depends on a single asset, waiting for timing to become clear isn’t passive; it’s exposure.
Flying Blind on the Most Important Number
One of the clearest indicators of this lack of readiness is valuation. More than 60% of owners in the Cornerstone study have never had a formal valuation or Real Market Analysis of their business.
Instead, many rely on informal estimates or industry multiples they’ve heard secondhand. The problem is that assumptions and estimates rarely reflect how an actual buyer would evaluate risk, cash flow, and future opportunity.
And running a company without understanding its real market value is like navigating without a map. You may feel confident. You may even be headed in the right direction. But you have no reliable way to judge distance, timing, or alternatives if conditions change.
Without that clarity, owners can’t recognize good timing. They can only react to urgent timing.
The Numbers that Matter
Clarity often comes down to understanding three numbers:
- The Real Number — what the business would likely command in today’s market
- The Net Number — what the owner would actually take home after debt, taxes, fees, and deal structure
- The Lifestyle Number™ — what the owner needs to fund the life they want after a transition
When owners see these numbers side by side, pressure often decreases. Some realize they are closer to financial independence than they expected. Others identify a gap early enough to improve value, reduce risk, or recalibrate expectations.
In either case, preparation creates options. And options are what allow owners to choose timing rather than react to it.
Timing is a Decision, Not a Signal
The most successful exits don’t happen because the market sends a clear message. They happen because preparation meets opportunity.
Owners who plan early don’t exit sooner; they exit better by protecting leverage, preserving flexibility, and avoiding surprises they could have anticipated. Waiting for the “right time” may feel prudent. But timing rarely taps you on the shoulder.
If you want control over when and how you exit your business, preparation must come first. Preparation puts you in the position to compare when the timing feels right with when you know it’s right.
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