Should I hire an M&A advisor or sell the business myself?
The question most owners ask second, after they've decided to sell. The answer most advisors give is conflicted. Here is the honest version.
Advisor vs self: decision matrix
| Situation | Self-represent | Hire an advisor |
|---|---|---|
| $1M–$3M EBITDA | Workable with corporate lawyer + CPA | Most lower-middle-market advisors won't take it |
| $3M–$5M EBITDA | Possible if buyer pool is narrow and known | Worth it if buyer universe is wide |
| $5M+ EBITDA | Rarely worth it — left value on the table | Advisor typically pays for itself via auction tension |
| Single known buyer | Self-rep with strong legal/CPA support | Advisor can still create competitive tension |
| Wide buyer universe | Hard to run a real auction alone | Advisor's process generates more than fee |
| Typical fee | Legal $50K–$150K, CPA $25K–$75K | Retainer $25K–$100K + 4–8% Lehman success fee |
| Time to close | 9–18 months, founder-led | 6–12 months with disciplined process |
When self-representation works
For smaller transactions ($1M–$3M EBITDA) where the buyer pool is narrow and personal relationships matter more than competitive process, self-representation can work — provided you have a corporate lawyer running the legal side and a CPA producing clean QofE-ready financials. Below this threshold, most lower-middle-market advisors won't take the engagement anyway.
When an advisor is worth the fee
For most lower-middle-market businesses ($5M+ EBITDA), an advisor pays for itself. They typically charge a retainer plus a Lehman-style success fee of 4–8% of transaction value[1], but they generate competitive tension across a wider buyer universe — PE platforms, strategic acquirers, family offices — than a founder can credibly run alone. The lift in headline multiple from a real auction process typically exceeds the fee.
The third option most owners miss
Get genuinely sale-ready first, then hire the advisor. An advisor selling a sale-ready business pitches a higher multiple credibly, runs a tighter process, and closes faster. An advisor selling an unprepared business compresses the multiple to close the deal — because that's what gets them paid [3]. The 12–24 months of readiness work typically pays back many multiples of the advisor's fee.
An advisor selling a sale-ready business pitches a higher multiple credibly. An advisor selling an unprepared business compresses the multiple to close the deal — because that's what gets them paid.XLev — Operator practice
Frequently asked questions
- Do I need an M&A advisor to sell my business?
- For lower-middle-market businesses ($5M+ EBITDA) the answer is usually yes — advisors typically charge 4–8% of transaction value but generate competitive bidder tension that lifts the headline multiple by more than the fee. For smaller transactions self-representation can work.
- How much does an M&A advisor cost?
- Lower-middle-market advisors typically charge a retainer ($25K–$100K) plus a success fee of 4–8% of transaction value, often on a Lehman-style scale (higher percentage on the first million, lower on subsequent millions). All-in fees on a $30M deal commonly run $1M–$2M.
- Can I sell my business without an advisor?
- Yes, particularly for smaller transactions ($1M–$3M EBITDA) where buyer pools are limited and personal relationships matter more. Above $5M EBITDA the buyer universe (PE platforms, strategic acquirers) is wide enough that an advisor's auction process typically generates more value than the fee.
- Is there an alternative to either option?
- Yes — get genuinely sale-ready first, then hire the advisor. An advisor selling a sale-ready business pitches a higher multiple credibly; an advisor selling an unprepared one compresses the multiple to close the deal. The 12–24 months of readiness work typically pays back many multiples of the advisor's fee.
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