Selling a Business: An Unequal Playing Field
2 February 2026: Selling a Business: An Unequal Playing Field
For many business owners, selling their company is a once-in-a-lifetime event. It represents years—often decades—of effort, personal sacrifice, and identity. And it almost ALWAYS is the largest they’ll experience.
By contrast, private equity firms and other professional acquirers buy and sell businesses for a living. They may complete dozens of transactions each year, supported by dedicated deal teams, advisors, playbooks, and capital. This fundamental imbalance of experience creates a series of challenges for sellers that extend far beyond price. Understanding these challenges is critical for any owner contemplating a sale.
On top of that, strategic buyers are active in the market and they are very likely to be represented by a mergers and acquisitions specialist – a firm that specializes in and has many years’ experience with the buying and selling of lower middle market businesses. This fundamental imbalance of experience creates a series of challenges for sellers that extend far beyond price. Understanding these challenges is critical for any owner contemplating a sale.
As professional business brokers and M&A specialists ourselves, you might expect us to try to convince any business owner that hiring the right talent to represent them would be an important component to increase the chances of a successful sale, you’re correct. We certainly would do that. But we recognize that some sellers are convinced they are capable of performing the functions of a certified broker themselves. For those who choose this FSBO route, we offer the following overview of the terrain.
The Experience and Knowledge Gap
The most obvious challenge is the sheer asymmetry of experience. The seller is usually navigating the process for the first—and probably only—time. Professional buyers, by contrast, have refined their approach through repeated transactions, post-mortems, and institutional learning.
This gap manifests in subtle but powerful ways. Buyers understand which issues truly matter and which are merely negotiating tools. Sellers often struggle to distinguish between legitimate concerns and tactics designed to extract concessions. The buyer knows the sequence of the deal, the pressure points, and when sellers are most vulnerable—typically late in the process, after emotional and financial momentum has built.
Because of this, sellers may misjudge risk, underestimate complexity, or place too much trust in buyer assurances that are later constrained by legal documentation.
Information Asymmetry and Control of the Narrative
Professional buyers are skilled at gathering, structuring, and interpreting information. They know what data to request, how to frame due diligence questions, and how to identify inconsistencies that can be leveraged during negotiations.
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We offer a comprehensive coaching program – both group coaching in The Brokers’ Roundtable℠, our online support community, as well as one-on-one coaching – tailored to Realtors, business owners, buyers and anyone interested in valuing, buying or selling a business.
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Business owners, on the other hand, often lack clean, well-organized data rooms or institutional reporting systems. Financials may be optimized for tax efficiency rather than transparency. Key knowledge may reside informally with the owner rather than in documented processes.
This imbalance allows buyers to control the narrative during due diligence. Normal business imperfections—customer concentration, margin volatility, or undocumented processes—can be reframed as risks requiring price reductions, earn-outs, or additional protections, even when such issues are common or manageable.
Valuation Expectations vs. Market Reality
As a rule, sellers of small and lower middle market businesses often have an exaggerated opinion of their business’ value. They anchor their expectations to emotionally charged benchmarks: years of effort invested, past sacrifices, or anecdotal stories of high-multiple exits. Professional buyers, however, approach valuation analytically, focusing on cash flow, risk, growth prospects, and exit potential.
This mismatch often creates tension. Sellers may feel undervalued or insulted, while buyers see themselves as disciplined and rational. Because buyers have seen hundreds of businesses, they are comfortable walking away. Sellers, facing the possibility that this may be their only exit opportunity, often feel far greater pressure to compromise.
Additionally, buyers frequently structure offers in ways that preserve headline valuation while shifting risk back to the seller through earn-outs, rollover equity, or deferred consideration—mechanisms sellers may not fully appreciate at first glance.
Process Fatigue and Psychological Pressure
Selling a business is emotionally and physically exhausting. The process can take six to twelve months or longer, involving endless meetings, document requests, legal reviews, and negotiations—all while the seller is still expected to run the business.
Professional buyers are accustomed to this intensity and build it into their operating rhythm. Sellers are not. As fatigue sets in, decision-making quality often declines. Sellers may become more willing to accept unfavorable terms simply to “get the deal done.”
Buyers are acutely aware of this dynamic. Late-stage retrades—where terms change after exclusivity or final diligence—are a common tactic. Sellers, already mentally committed to the outcome, may feel trapped.
Legal Complexity and Documentation Risk
Transaction documents are dense, technical, and heavily negotiated. Purchase agreements, disclosure schedules, indemnities, warranties, covenants, and non-competes can run hundreds of pages.
Professional buyers understand that economic outcomes are often determined less by headline price and more by these legal details. Sellers, unfamiliar with deal mechanics, may underestimate their importance or rely too heavily on advisors without fully grasping the implications.
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Our course, “Learn How to Value and SUCCESSFULLY Sell Businesses“, teaches you how to accurately value and successfully sell businesses.
Post-Closing Obligations and Loss of Control
Many sellers assume that once the deal closes, their involvement ends. In reality, professional buyers often expect ongoing engagement: management retention, transition services, earn-out performance, or equity rollovers.
This can be jarring. Sellers who were previously in full control must now answer to boards, investors, and reporting requirements. Strategic decisions may be driven by exit timelines rather than long-term stewardship.
If expectations are not clearly aligned upfront, sellers may experience frustration, loss of autonomy, or even regret—particularly if their financial outcome depends on future performance under constraints they do not control.
Negotiation Tactics and Strategic Sophistication
Professional buyers employ structured negotiation tactics: anchoring, deadline pressure, issue-linking, and strategic concessions. They often negotiate as teams, with clear internal roles and escalation paths.
Check out our series The 6 Essential Elements of Selling a Business Successfully (starting 2 February ’26) on our YouTube channel.
Sellers, by contrast, may negotiate alone or with limited support, relying on intuition rather than strategy. Emotional attachment to the business can further impair objectivity, making it difficult to separate personal identity from commercial outcomes.
This imbalance increases the likelihood that sellers concede on points that compound against them—small issues that collectively shift significant value or risk. This imbalance should also clearly illustrate the value of and need for a qualified business broker.
Timing and Opportunity Cost
Private equity buyers are opportunistic. They track markets, sectors, and cycles closely and often time acquisitions to maximize return potential. Sellers, however, may be driven by personal circumstances—burnout, health, succession issues—that limit flexibility.
This difference in timing leverage can weaken the seller’s negotiating position. Buyers know that motivated sellers often prioritize certainty over optimization, and structure deals accordingly.
Emotional Bias and Identity Risk
Finally, there is the deeply human challenge of letting go. For many owners, the business is not just an asset but a reflection of self-worth, relationships, and legacy.
Professional buyers are emotionally detached. They can make cold, rational decisions about cost-cutting, restructuring, or eventual resale. Sellers may struggle to reconcile these realities with their emotional investment, making it harder to evaluate offers objectively or walk away when necessary.
The Bottom Line
Selling a business to a private equity firm or other professional buyer is not simply a financial transaction—it is a high-stakes negotiation played on uneven ground. The seller’s inexperience, emotional attachment, and limited exposure to deal mechanics contrast sharply with the buyer’s institutional knowledge, strategic discipline, and negotiating sophistication.
These challenges do not mean that sellers are destined to lose. But they do mean that preparation, education, and strong, aligned, experienced advice are essential. Recognizing the imbalance is the first step toward mitigating it—and toward ensuring that the sale of a lifetime reflects not just the buyer’s expertise, but the true value of what the seller has built.
I’d like to hear from you. What topics would you like me to cover? How can we tailor these posts to be more useful to you and your business. Let me know in the comments box, below, or email me at jo*@*******************og.com.
Check out our video series, “How Much is My Business Worth“on our YouTube channel.
“Don’t be cocky. Don’t be flashy. There’s always someone better than you..”
–Tony Hsieh, Zappos founder
If you have any questions or comments on this topic – or any topic related to business – I’d like to hear from you. Put them in the comments box below. Start the conversation and I’ll get back to you with answers or my own comments. If I get enough on one topic, I’ll address them in a future post or podcast.
I’ll be back with you again next Monday. In the meantime, I hope you have a safe and profitable week.
Joe
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The author is the founder, in 2001, of Worldwide Business Brokers and holds a certification from the International Business Brokers Association (IBBA) as a Certified Business Intermediary (CBI) of which there are fewer than 600 in the world. He can be reached at jo*@*******************og.com
