8 things most brokers won’t tell you about selling your business

So you’ve taken the plunge and made the decision that you’re actually going to sell your business. There are many choices to make on your way towards a successful exit, including one which is especially important.

The crucial first step in any business sale is finding the right broker for you, so you’re introduced to a range of opportunities. Trouble is, even brokers who seem like the perfect fit on first impressions often have this common flaw:

Most brokers don’t tell you what selling a financial advice business is really like, because they can’t – they’ve never done it themselves.

Read on to learn how to avoid the pitfalls business owners like you always come across, and the must-haves you should look for in a broker.

8 things most brokers won’t tell you about selling your business

  1. It always takes longer than you think it will

If you expect your business sale to be done in 4 months, it’ll take 6.

If you’ve been told your sale will complete in 9 months, add 3 months on top of that.

A broker may tell you how quick and easy it is to sell a business, and how they’ve done it a million times. But they’ve never sold your business before…

…which means they can’t know which bumps in the road might arise. Be prepared for a longer journey than you may have first thought.

  1. Due diligence is the Mount Everest of the process

Imagine your business is a sofa. If you wanted to sell that sofa, you’d expect the person buying it to rummage around and make sure they felt comfortable, wouldn’t you?

What you might not expect is the buyer to look under the sofa, check where you bought it, ask for receipts from when it was last cleaned, and so on.

So don’t wait until the buyer takes a look. Most brokers are keen to rush you to market, but this will end in tears, and not theirs. Understand the due diligence process and make sure you’re ready – here’s a free tool to help you.

  1. It’s critical to find a buyer who looks after their clients the way you look after yours

You’ve worked tirelessly over the years to build a business your clients trust, and they know what to expect from the service they receive. Don’t undo all that hard work by selling to a buyer who deals with their clients completely differently.

Picture one of your clients jetting off on their annual summer holiday, lockdowns permitting. Every year, they fly with British Airways, and they’re used to a certain standard as a result. Imagine how they’d feel if one year there’d been a change of ownership, and they’d paid British Airways prices but got Aeroflot service.

  1. Both opportunity and risk are paramount

After they’ve investigated every corner of your business, brokers should tell you what they think it’s worth on the market. But there’s a little detail they probably aren’t explaining in full.

The valuation of your business isn’t just based on the opportunities the buyer thinks it presents. It also takes into account the risk the buyer feels they’ll be taking on, even under an asset sale, such as reputational risk if things go wrong with the previous business. And here’s the thing about that:

Different buyers look at risk in very different ways. The broker’s job is to help you find a buyer whose vision for the business is in harmony with your own.

  1. You need to look at the whole deal, not just the ‘consideration’

When valuing your business, brokers tend to narrowly focus your attention on the pound coins you’ll get from the sale – the ‘consideration’. But that’s just the headline figure – it’s not the whole story by a long, long way.

Concentrating only on the multiple is like going to buy a car and just asking about its top speed. If you want a pleasant drive in the long run, you need to know about its servicing costs, reliability, and fuel efficiency too.

Don’t get distracted by short-term gains. A higher multiple often means more strings are attached. So make sure you understand these, and what they mean for your future.

  1. There’s often a ‘pool’ of buyers who brokers prefer to work with

Brokers aren’t free, and if you aren’t explicitly paying them, their fee is a cost of purchase and factored into any offer made. So shouldn’t you expect them to have your best interests at heart?

If you aren’t paying them direct, you aren’t their client. They’ll be limited in that they’ll only be able to make introductions to firms willing to pay their fee, a bit like a multi-tied proposition for a financial planner.

Some acquirers will pay 5%, others will pay 3%, and many 0%. How do you know what each acquirer would pay them and the conflict this could present? You might be shocked to hear that some brokers even have shares in the buyers they’re sending your way.

You want the best possible result from the sale of your business. So you should choose a broker who’ll give you a full, impartial introduction to potential buyers who have the capacity, appetite and resource (as well as easy harmonisation), and get the right result for you, not them.

  1. There are many different exit options

By default, most brokers will look to sell your business externally to a large firm. Here are just some of the other routes you could take:

  • Private equity
  • Management buyout
  • Employee Ownership Trust (EOT)
  • Sell some of your shares

If your broker is steering you towards one particular option, consider whether the advice they’re giving is as comprehensive and unbiased as you’d want it to be.

  1. It’s rare to find a broker who has ever sold, or even run, their own financial advice business

Say you wake up one day and find yourself lost in the Himalayas, and you must climb a snowy mountain to get back to camp. Suddenly, two Sherpa guides appear, each with their own offer of help:

The first says he’s never scaled that exact mountain before, or in fact any mountain, but knows the region well, and can draw you a map as he’s sent other climbers that way before.

The second tells you he’s actually climbed the mountain many times, knows the best routes to take, and can lead you there himself.

Whose offer do you accept?

Your broker may have a slick sales machine and promises to sell your business for you, but they’ve probably never been a seller themselves. And sometimes, there’s no substitute for hands-on experience, particularly if you’re only ever going to do this once.

In conclusion

Selling your business is one of the most significant milestones in your life, and it’s a broker’s job to make the process easier. Time and time again, in our experience, they fall short for the same reasons:

  • They’ve never run, built or sold their own financial advice business
  • They don’t present all the best options about types of sale and potential buyers
  • They’re usually focused on what makes them the most money, quickest
  • They often withhold key details about valuation, due diligence, and how long the sale will take

How do we know this? Because we used the very same brokers to sell our own financial advice firms.

But here’s the good news:

Now, you know what to watch out for.

You’ve learned the eight things most brokers won’t tell you about selling your business. And that means you’ve got all the know-how you need to make the choices that are right for you, and to get the very best from your broker.

Why choose us

We’ve been in your shoes and run our own Directly Authorised advice businesses for many years, which we successfully sold. Now we’re working for people just like you.

With our Partner service, we can act for you, not the buyer of your business. That means we’re firmly in your camp, focused on delivering an exit that’s right for you, your family and your clients.

Contact us today to learn how we can help you sell your business.


How can we help you get the right exit for you and your clients?
Have a read


Change in control – the FCA Supervision Review explained
Have a read


The Yorkshire Times: 10 in 10 – Victoria Hicks
Have a read
Arrow icon

We're your

Say 'elo

We’ve got our thinking caps on and we’re ready to mingle.

    How can we help?