The $15M exit that turned into $5M – how much you should plan to keep after selling a business

The $15M exit that turned into $5M

A client just sold their business for $15 million… and walked away with about $5 million in the bank.

Here’s where the other $10M went:

First, $3M of business debt had to be paid off.

Then $1M of working capital had to stay in the business as part of the deal.

And then the rest of the real-world deductions show up:

• Taxes
• Legal and accounting fees
• Investment banker fees
• Employee bonuses
• Rollover equity
• Earnouts

By the time everything settled, the actual cash he walked away with was closer to $5M.

Still great.

But very different than the $15M headline sale price.

For many business owners, their company is their primary retirement asset.

Which means the number that really matters isn’t the sale price…

…it’s the after-tax dollars that actually hit your bank account.

Understanding that number years before you sell can completely change how you structure the deal, plan for taxes, and prepare for retirement.

Because when it comes to selling your business, knowing what you are going to keep matters far more than what you sell it for.

Make sure you are working with an advisor who can help you determine what the right number is.

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