Embracing 11 fundamental steps before attempting a sale can help founders avoid major pitfalls. From building a strong competitive moat to managing a trustworthy leadership bench, each principle lays the groundwork for a smoother, more fulfilling exit.
Planning a business exit sparks plenty of questions for founders. In this overview from our keynote with Fairmount Partners, we discuss how clear positioning, accurate finances, and a strong team reduce regrets and enhance your odds of success.
Selling a company can be the highlight of your entrepreneurial journey—or it can lead to regret if you skip crucial steps. In a recent keynote titled “What Every Founder Needs to Know Before Exiting,” I teamed up with Allen Born of Fairmount Partners to explore lessons many founders wish they’d known earlier. Drawing on our experiences in HR/work technology advisory and investment banking, we outlined ways to position your business so potential buyers see genuine value from day one.
Below, you’ll find an overview of the key points we covered. You’ll also see quotes from our discussion that highlight real scenarios, personal lessons, and strategic steps you can take right now. Whether you’re a first-time founder or a seasoned entrepreneur, these insights can help align your company for a smoother exit.
One of the first questions buyers or investors ask is: “What makes you different?” If you can’t explain that quickly and clearly, potential partners will struggle to see the true value you bring to the market. In the keynote, both Allen Born and I emphasized the importance of defining a compelling identity from the start—before you even think about selling or raising capital.
“When you’re competing against a strong solution... we’re not doing anybody any good by just taking what they tell us and not pressure testing it.” – Allen Born
I’ve also watched founders wrestle with this in real time. As I shared:
“We’ve been in the industry for a long time and made plenty of mistakes. Our goal is to help others avoid the same missteps.” – Marilyn Pearson Hendricks (MPH)
Standing out isn’t enough unless you protect your lead. A “moat” means staying several steps ahead through continued innovation, strategic relationships, or exclusive technology—whatever keeps competitors at a distance.
“You need to always think about developing a well-articulated roadmap... so that buyers see your business as protected from competition today and in the future.” – Allen Born
I often advise founders to continually reinvest in meaningful improvements. A hidden threat is that you can lose your lead by becoming complacent. A few tweaks each quarter, whether it’s an enhanced feature or a re-energized partnership, can make a big difference in maintaining momentum.
You can’t operate in a vacuum. You risk missing clear opportunities if you don’t know who your competitors are or what they offer. Analyzing your strengths and weaknesses against others helps you sharpen your messaging, refine your product, and uncover untapped markets.
“When you think about just talent acquisition or HR Tech, people put themselves into buckets. It’s good to explain quickly: ‘Here’s what we do, here’s the area we play in.’” – Allen Born
“The language you use to tell your story matters. Founders can struggle with placing themselves in the right context.” – Marilyn Pearson Hendricks (MPH)
It is tempting to have a massive “total addressable market” (TAM), but an inflated number without a strong rationale damages credibility. Investors look for well-researched, reality-based market estimates that show clear paths to growth.
“We look at top-down and bottom-up. If the TAM is only 50 million, you can’t realistically be a 200-million company.” – Allen Born
Potential buyers will examine everything—from how you record revenue to how you manage daily operations. Weak processes, blurry financials, or misaligned expense categories quickly raise red flags, slowing or derailing a deal.
“Buyers are going to look at your financial statements in detail. If you stumble over your numbers, you exude a lack of confidence.” – Allen Born
“In my first personal round of due diligence, we were running on cash-based QuickBooks. It took about a year to clean that up.” – Marilyn Pearson Hendricks (MPH)
Forecasting accurately signals control and awareness of your market. Investors can tell when estimates are based on real metrics or wishful thinking. Align your forecast with historical performance, funnel data, and customer behavior.
“When we go to market, we need 100% confidence in the current year’s forecast. Nothing kills a deal faster than missing numbers.” – Allen Born
A strong funnel reflects healthy demand. Buyers want to see that leads flow reliably through each stage, indicating a scalable and repeatable sales process.
“Track your funnel at a point in time, and compare that to your coverage model. If the funnel is strong, it signals real growth potential.” – Allen Born
Even if your product is brilliant, it won’t matter unless you’re visible. Showcasing your expertise at conferences, in publications, or through podcasts can elevate your brand and attract potential buyers or partners.
“It’s not just about lines of code; it’s about building the right connections and showing up where decision-makers are looking.” – Marilyn Pearson Hendricks (MPH)
Founders who act as the “CEO show” can scare off investors. Buyers worry about a scenario where the company loses steam once the founder departs. Build a reliable leadership team that can operate smoothly without you.
“What a buyer is going to be terrified of is acquiring your business...and having you at the beach.” – Allen Born
Consistently meeting goals—whether monthly bookings or quarterly revenue—reassures buyers that you can forecast accurately and execute on promises.
“Missing your goals signals potential misalignment. Buyers pay attention to that detail more than you might think.” – Marilyn Pearson Hendricks (MPH)
A well-versed advisor can distinguish between a deal that fizzles and closes seamlessly. They often bring insight, connections, and frameworks that founders might not have.
“We serve as a good insurance policy... We vet your buyer and help you be ready for deeper questions.” – Allen Born
“In our work with founders, we look for subtle signals in their business. Sometimes it’s the overlooked areas that present the biggest opportunities.” – Marilyn Pearson Hendricks (MPH)
Shaping a sale-ready business involves much more than just finding a buyer. It’s about strategic thinking, cohesive leadership, and consistent execution across all facets of your company. Each of these 11 “commandments”—from differentiating your offering to maintaining strong financial discipline—works together to reduce risk and provide a clear path to growth and eventual exit.
For the full discussion, view the session on HR Tech Alliance’s YouTube channel:
If you want tailored guidance, check out how we support HR tech and work technology leaders. We specialize in helping founders define their unique advantage, build a stable leadership structure, and ensure they’re well-prepared for the next phase—be it raising capital or negotiating a sale.
Questions about positioning your business for investors? Reach out!