Most owners assume the hard part of an exit is finding the buyer. The harder part is making sure the business – and the family behind it – survives the transition, planned or not.
On September 16, The Alternative Board Fort Worth & West hosted Ms. Anne Salick, CEPA, CPFA, Senior Director of Personal Planning and Business Strategies at Sandene Strategies, for the third session in our Exit Planning Series. Her presentation, “Financial Risks That Can Derail Your Business Exit,” centered on six statements she hears regularly from owners:
· “I know what my business is really worth.”
· “I’m too busy running the company.”
· “That’ll never happen to me.”
· “There’s plenty of time for that.”
· “My business is my retirement.”
· “You can’t beat Uncle Sam.”
Each one sounds reasonable. And each one can be expensive.
Attending business owners and supporting advisors used a weighted self-assessment covering 32 actions across these six areas to reveal where their greatest exposure lies. In the open discussion that followed, three connected vulnerabilities stood out: an outdated valuation and buy-sell agreement when partners are involved, an uncoordinated succession and estate plan, and too much retirement wealth concentrated in the business. Underneath all three was the same dangerous assumption: there is still plenty of time.
“I Know What My Business Is Worth” Most owners carry a number in their head. It usually comes from what a competitor sold for, a rule of thumb from the industry, or what the owner needs the business to be worth.
The key takeaway was that valuation is not a one-time exercise. Owners should establish a formula valuation and refresh it regularly, because that single number drives three separate things: the buy-sell agreement if applicable, the funding behind that buy-sell agreement, and the estate plan.
When the valuation drifts and those documents do not move with it, all three are wrong at the same moment.
Partners and the Buy-Sell Agreement: Continuity, Not Paperwork A current valuation matters because it anchors the buy-sell agreement, the funding behind that agreement, and the owner’s estate plan. This is where the discussion among attendees became especially specific.
The funding question is the one that costs real money. An unfunded buy-sell is a promise, not a plan. If a partner dies and the agreement obligates the company to purchase that interest, the obligation is real whether or not the cash exists. The surviving partner or partners then fund the buyout from working capital, or by borrowing on unfavorable terms, or by selling the business at the worst possible moment, often to the only buyer willing to move quickly.
Disability is the scenario most owners skip. Life insurance may fund a buyout after a death, but disability often triggers disagreement: the partner remains an owner and may remain on the payroll while unable to contribute. Disability buy-out coverage and business overhead expense coverage address that gap.
A buy-sell agreement reviewed once at formation describes a company that no longer exists. Ownership percentages shift, valuations move, partners marry and divorce, and tax law changes. A three-year review cycle is not a formality. It is what keeps the agreement connected to the business it governs.
For an Owner, Succession Planning Is a Family Conversation The second and third assumptions – “I’m too busy running the company” and “that’ll never happen to me” – travel together and land in the same place. For most owner-led companies, succession planning and personal estate planning are not two projects. They are one.
Is the will, trust, or estate plan current? Is there a power of attorney, a HIPAA authorization, and a physician’s directive? Do you have a current succession plan? Does it include provisions for disability, not only death?
Have you identified—in writing—who replaces you? Do your family members and key employees know who that person is?
In an unplanned exit, the people who must act immediately are family members. A spouse who has never attended a board meeting may suddenly hold controlling interest, alongside key employees who do not know whether they still have jobs. The business does not pause while they sort it out.
Telling your family and your key people in advance is not a legal step. It is a kindness, and it protects the value everyone is depending on.
“My Business Is My Retirement” Many owners also depend on the business for retirement, sometimes holding up to 95 percent of their net worth in it. That concentration makes waiting to diversify especially risky. Questions raised included how many had investments outside the company, how many had built income streams independent of their business, and how many had run a retirement projection that did not assume a successful sale at a favorable price.
And if you have a concentrated position in an asset you control, it still carries the risk of an industry or an economy that turns before you are ready. These ownership problems are best addressed during those “ordinary operating years,” before a buyer is calling or an exit becomes urgent.
The Big Lesson of the 6th Assumption The sixth assumption, “you can’t beat Uncle Sam,” deserves a session of its own; and we will focus on that at the next invitation-only lunch on Wednesday, October 21. Tax planning is the final program in the four-part Optimizing Your Future Exit Series.
Closing Thought The exit you plan is a transaction. The exit you did not plan is an emergency. Same business, same family, very different outcome. And thanks again to Anne Salick for sharing her expertise.
UPCOMING OWNER OPTIMIZING FUTURE EXIT LUNCHEON The 4th and final lunch session for 2026 in this series on Optimizing Your Future Exit will be Wednesday, October 21, at Pappadeaux Seafood Kitchen, Fort Worth. Focused on tax implications. Mr. Gary Jackson, Tax & Consulting Partner, CJ Group, will lead discussion on Structuring the Sale to Minimize the Tax Bite. For inquiries regarding potential attendance, contact Ed Riefenstahl at eriefenstahl@tabfortworth.com
ABOUT THE AUTHOR
Ed Riefenstahl is the co-owner of The Alternative Board (TAB) Fort Worth and West, where for over 20 years he has facilitated peer advisory boards and has worked with business owners to improve performance and prepare for successful exits. He previously served as Director of the MBA Consulting Program at Texas Christian University’s Neeley School of Business, where he founded and led Neeley & Associates Consulting.
ABOUT THE ALTERNATIVE BOARD (TAB) FORT WORTH & WEST
The Alternative Board (TAB) Fort Worth & West provides peer advisory boards, executive coaching, and proprietary systems and tools for owner-led businesses and leaders of nonprofit organizations. Each board brings together a small group of non-competing business owners who meet monthly in a confidential setting to share real-world experiences, challenge assumptions, and improve decision-making. TAB members also utilize strategic tools and frameworks enabled by AI that are designed to help align leadership teams, execute priorities, and build more transferable, valuable businesses over time
