By the time you’ve reached the final stages of selling your business, you’ve already done the hard work: cleaned up your books, found a buyer, and navigated due diligence. But make no mistake, deals can still die in the red zone.

And when they do, it’s almost always for the same reasons, which we will go over here.

Let’s talk about the most common deal killers, how to avoid them, and what to do to keep your deal moving forward.

The four biggest deal killers we see

 1. Time

Time is the silent killer of deals. The longer a deal drags on, the more opportunities there are for doubt to creep in, numbers to slip, or market conditions to change.

Keep momentum by being responsive, staying organized, and setting clear deadlines. Every delay, whether from you, your team, or your advisors, chips away at the buyer’s confidence.

2. Legal Issues or Partnership Disputes

Unresolved legal disputes, unclear ownership, or messy partnership agreements are giant red flags. Buyers don’t want to inherit your legal headaches.

Instead, get ahead of potential issues before you even go to market. Clean up contracts, settle disputes, and make sure your ownership structure is airtight.

 3. Numbers That Don’t Match

If your CIM (Confidential Information Memorandum) paints one picture but your actual numbers tell another, expect trouble. Buyers will find discrepancies, always. They’re investing millions of dollars. It’s their right to ensure all of your numbers add up (investors who don’t do their homework don’t stay in the investing field for long).

Be accurate and transparent. If there’s a dip in revenue, explain it with context. Offering explanations in advance allows you to control the narrative. Surprises in due diligence almost always cost money or kill deals entirely. 

4. Declining Revenue or EBITDA During the Process

Buyers are buying the future of your company, not just its past. If revenue or margins start slipping during the deal process, it’s like hitting the brakes at full speed.

So keep your foot on the gas. Even while you’re in negotiations, focus on running and growing your business. Don’t give up while you’re so close to the finish line! Nothing builds buyer confidence like steady or increasing numbers.

Now that we know what can sink your deal, here’s how to keep it alive and thriving so you can take it to the finish line:

Tips for success

• Keep growing. Even small upticks in revenue can boost buyer confidence and valuation.

• Make due diligence easy. Organize your data room, respond quickly, and show that your business runs like a well-oiled machine.

• Be flexible. Sometimes deals require a little give-and-take. Don’t lose sight of the bigger picture by getting hung up on a small term in the agreement. (Remember, a $20K negotiation item isn’t worth losing a $10M deal over). 

• Stay calm under pressure. Buyers want to work with sellers who are professional, prepared, and reasonable.

Deals fall apart when sellers get tired, distracted, or defensive. Momentum is your greatest ally. 

The more you anticipate and smooth out potential roadblocks, the faster you’ll close and the higher the odds of a successful exit. 

If you want to learn how to keep up your business’s momentum and stay attractive to buyers, book a call with an M&A advisor. 

In the next and final post, we’ll talk about what happens on closing day, from how to announce the deal to what to tell your team, and how to prepare for the next chapter of your life after the sale.