Over the years, we’ve had a lot of discussions about exit timing with founders and one issue often comes up. The founder wants to “finish everything” and have a “perfect” business before they sell. This is understandable, and demonstrates a sense of pride in the business, but is it actually the best strategy?

It may seem counterintuitive, but it is usually better to “leave something for the buyer to do.” We’re not talking about trying to sell a business with gaping flaws, but it isn’t necessary to fix or complete everything before commencing a process. For example, there may be a major release planned or a new market that could be entered. Leaving these for the buyer provides them with more upside and helps the acquirer anticipate how they could take the business to the next level.

Conversely, if there is “nothing left to do”, buyers are left with a purely financial business case with little room for imagination. The best scenario is one where the buyer loves the business as it is and is excited about what it could become. Painting a picture of the opportunities that have not yet been taken can help the corporate development team sell the acquisition internally and justify a higher valuation.

Leaving something for the buyer to do can bring forward your exit by years, reduces execution risk and can potentially deliver a higher valuation.