By the time a deal is signed, most of the important decisions have already been made.
I know that sounds backwards. The closing feels like the big moment: the papers, the wire transfer, the number that finally becomes real. But the choices that shape what that number means for your life, how it’s taxed, how it’s structured, whether it truly funds the future you have in mind, mostly get locked in earlier. Sometimes months earlier, and sometimes the moment a letter of intent gets signed.
Which means the real planning work isn’t what happens after a business sale, an IPO, a vesting event, or the sale of a significant piece of real estate.
It’s what happens before, while there’s still room to choose.
Start with the life, not the deal.
Before any conversation about structure or timing, it’s worth answering a question that’s easy to skip when a deal is moving fast: what does life actually look like on the other side of this?
Do you want to keep working in some capacity? Slow down completely? Start something new? Move? Support family in a different way?
That answer shapes almost everything downstream, including how you negotiate the deal itself.
Someone who wants immediate liquidity to fund a lifestyle change is going to structure things differently than someone who’s comfortable with an earnout or a longer transition period.
Without that clarity, it’s easy to accept terms that look fine on paper but don’t actually serve what you wanted.
Picture a business owner who’s been approached about selling. If she already knows she wants to step back completely and spend more time with her aging parents, that’s a very different deal than the one she’d negotiate if she actually wants to stay on and run the company for another five years under new ownership. Same offer on the table, two completely different right answers, depending on what she’s already decided about her own life.
Some of the best strategies only work before the value is locked in.
Once a business has a signed letter of intent, or once equity has a clear, imminent liquidity date, a number of planning strategies stop being available.
Certain gifting and trust strategies depend on transferring value while it’s still uncertain or hasn’t fully appreciated.
For those holding incentive stock options, the timing of when you exercise matters just as much.
Exercising early, sometimes years before a vesting event or a sale, can start the clock on more favorable long-term capital gains treatment, but it comes with its own considerations, including the alternative minimum tax, a separate tax calculation that can offset some of that benefit if you’re not careful. Once a sale or IPO is already in motion, that window is often gone.
Tax-loss harvesting, a strategy where you can bank losses elsewhere in a portfolio ahead of time, can help offset some of the gain from the sale. More losses can be banked if you start early.
If real estate is part of the picture, strategies like a 1031 exchange or a Delaware Statutory Trust, both ways to defer taxes by reinvesting the proceeds into another property, work best when you’ve identified the replacement investment in advance to facilitate the strict timeline, not deciding after the sale is already done.
For business owners specifically, deals are often priced as a multiple of EBITDA, a common measure of how much a business earns before certain expenses. Working to improve the business sale value, from cleaning up the financials to systemizing the business to make it more saleable, can multiply what the business is worth.
None of this happens by accident, and none of it happens on the timeline of the deal itself. It happens on the timeline of getting your team in place early enough to act.
Build the team before you’re negotiating with someone else’s.
It’s common for a business owner or executive to lean almost entirely on a deal attorney and an investment banker in the run-up to a sale, and understandably so.
Those professionals are essential to getting the deal itself right, but the deal team is optimizing for the transaction.
Someone still needs to be looking at what the transaction means for your household: your tax exposure, your estate plan, your investment strategy on the other side, and whether the structure of the deal serves the life you mapped out at the start.
The earlier a financial planner is looped in, ideally before terms are being negotiated, the more options are still on the table.
Know your number before someone else brings one to you.
One of the more disorienting parts of an approaching liquidity event is that offers and valuations start to feel like verdicts.
If you don’t already know what number changes your life, and what number doesn’t, it’s easy to anchor to whatever figure shows up first, whether that’s a buyer’s opening offer or a banker’s estimate.
Having a real answer to “what do I actually need this to be” before you’re in a negotiation gives you something steadier to stand on than the number in front of you.
There’s also a way to influence the other side of this equation. Deals involving a business are often priced as a multiple of EBITDA, so getting the books clean and defensible well before you’re in a negotiation doesn’t just help you know your number, it can meaningfully increase your actual take-home.
Before any offer or valuation is in front of you, try answering this on your own: what number would actually change your life, and what would you do differently the day after you had it? If you can’t answer that in a sentence or two, that’s usually the first thing worth sorting out, before any conversation with a buyer or banker.
Get ahead on the planning conversation, even if nothing is imminent.
If a sale, a vesting date, or some other liquidity event is somewhere on your horizon, even a vague one, the planning conversation is worth having earlier than it feels necessary.
The options that exist today are not guaranteed to exist once a deal is actually in motion.
If you’d like to talk through what pre-transaction planning looks like for your specific situation, schedule a Get to Know You call and we’ll talk through it.
