Bridging Generations in Sales and Outreach

E3 with Bob Tankesley - Sellers, Buyers, and Everything in Between

• Butch Nicholson • Season 1 • Episode 3

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If you’re a founder or CEO with thoughts of selling your business one day, this episode might change your timeline or at least your mindset. 

Butch Nicholson sits down with Bob Tankesley, M&A advisor and author of Exit Teams, to reveal a stat every business owner needs to hear: only 4 percent of companies ever sell. Most don’t fail because they’re not profitable—they fail because they’re not prepared. 

In this conversation, Bob outlines exactly what it takes to make your business market-ready and why that work needs to start years in advance.

Key Takeaways:

  • The buyer mindset has changed
    Today’s buyers are more selective, cautious, and risk-aware than ever before. Due diligence is longer and more detailed, and buyers are asking tougher questions.
  • The 4 percent statistic and why it’s so low
    Only one in five companies ever make it to market, and just 20 percent of those actually sell. That’s 4 percent overall—a sobering figure rooted in poor preparation and unrealistic expectations.
  • Sellers must learn to think like buyers
    Founders often don’t know what makes their business attractive or unattractive to potential acquirers. Making the mental shift to buyer-focused thinking is crucial.
  • You need a team, not just a broker
    M&A advisor, transaction attorney, fractional CFO, fractional marketing—these roles are critical in creating a business that can thrive without its owner at the center.
  • Start three years before you plan to sell
    Optimizing a business for sale isn’t a quick fix. Bob recommends starting at least two to three years before a potential exit to make meaningful improvements that boost valuation.


 This episode offers seasoned business owners a candid roadmap to a successful sale. Bob Tankesley doesn’t sugarcoat the challenges, he’s seen too many owners miss out because they started too late, planned too little, or refused to delegate. 

If you’re thinking about selling in the next five to ten years, or advising someone who is, this episode delivers the clarity, urgency, and structure you need to act now rather than later.

Bridging Generations in Sales and Outreach is hosted by Robert (BUTCH) NICHOLSON and produced by Fist Bump

Helping Gen X and Baby Boomer leaders turn their reputation into revenue—without losing the human touch.

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(Butch) So welcome to Bridging Generations in Sales and Outreach. I'm Butch Nicholson. I'm the host of the show. First before we get started, I want to thank Fist Bump, who has produced, marketed, and promoted our show. We're very grateful for their support.(Butch) Today we're going to talk about mergers and acquisitions. It's a space that everybody should know about, but you're going to be surprised how little you knew. I did a search on the largest MMAs ever and the largest one ever, I didn't know who the first two companies were. So we're going to learn a lot today from my good friend, Bob Tankesley and his book about exit teams.(Butch) Bob, and welcome to the podcast.(Bob) Well, thanks man, thanks so much for having me. Look forward to what we're gonna talk about.(Butch) So Bob, let me just start with this question because we're in this, in the sales and marketing and just how companies work. We're in this period where things are changing faster than anybody can keep up with. So what have you seen as the evolution(Butch) over the last 10 or 12 years of the M&A space?(Bob) I think you could, the best way to probably say how things have changed is that buyers have gotten more selective. They've gotten more active, but that buyers have gotten more selective. They've gotten more active, but they've really gotten more selective. They're asking tougher questions of seller clients. The due diligence is getting longer.(Bob) They're really digging in and you can't blame them. There's a lot more risk that they're facing now than they were 10, 12 years ago. So with so much money chasing ever fewer deals, they have to really be careful how they use that capital, whether it's their own or borrowed money(Bob) or investor capital. I would say buyer behavior is probably the biggest change we've noticed.(Butch) So elaborate on that a little bit if you will, Bob, how the buyer behavior has changed.(Bob) So buyers have always been concerned about what they don't know. When they buy a business, they're seeing it for the first time, they don seeing it for the first time, they don't know what the seller knows. There's this, what I call this information asymmetry, the difference between what a seller knows about their company,(Bob) which is down to very great levels of detail, and what a buyer knows about a company that they're just beginning to look at.(Bob) I call that information asymmetry, a buyer knows about a company that they're just beginning to look at.(Bob) I call that information asymmetry, that this huge difference between what one side knows and what the other side knows. So there's always been that difference. Buyers try to know what they need to know before doing the deal, before getting to closing, and they ask as many questions as they can think of very due diligence and in the lead up to do to pure due diligence but it seems(Bob) like they're asking a lot more pointed questions these days a lot more granular questions these days and I said as I said before you really can't blame them now compared to 10-12 years ago an increase in interest rates is now a factor. Inflation is now more of a factor than it's been in what, a generation and a half, maybe two. As we sit here on April 11th of 2025, tariffs are now an issue that(Bob) buyers are now having to factor in to their decision making. So to your point earlier, it seems like things are moving faster, a lot more for buyers to consider these days.(Butch) Bob, one thing just pops into my mind while you were talking about what buyers know and what sellers know. I would think, and this is maybe something that your team helps with, but one of the problems I can see having is what the seller doesn't know about themselves.(Bob) Oh boy, yeah. Now you're gonna get me started about, you know, the boundless optimism that owners who run companies have. It's just this very optimistic view of the world coupled with, let's be honest, a little bit of stubbornness. And so just at a really high level, what that tends to result in is them tuning out a lot of(Bob) voices and opinions and perspectives that conflict with their own. So here they go, you know, years and years of running their business and they're sprinting toward retirement it seems. They've built something, they are building something that could have been optimized, could have been run better along the way.(Bob) And yet it wasn't. Now, you could say that the sense of optimism is so overwhelming that that's what's keeping them from listening to other voices, to input from outside advisors. For example, you could say it's extreme stubbornness.(Bob) Well, let's call it tenacity. But it probably comes down to them not knowing what they don't know and not enough advisors around them leaning in and helping them understand, hey, there's a way to optimize your company. There's a way to run it, build it so that it's more ready for sale than it's on track to be now.(Bob) And I think the way you get there is by tactfully, of course, helping an owner who's someday gonna be a seller to start thinking like a buyer. It's an incredibly difficult mind shift for someone to make who started or bought somebody else's business. They've been running it for 10, 15, 20 plus years. Incredibly difficult way of shifting their(Bob) thinking to now thinking of someone they don't know yet, someone or some firm that's going to buy their business exclusively thinking like them, no longer thinking like the owner, hey, what can I get out of this business? But how can I make this more efficient? How can I make this more attractive for the next owner of it? I got to tell you, I'll probably make this point more than once, it is so worth it for owners to make that mind shift to thinking more like a buyer, long before they get to the selling process.(Butch) Yeah, well, I've been part part I've had ownership in three companies and We always thought we had the prettiest baby(Bob) Sure you did I'm sure(Butch) Yeah, I would think that's you know, everybody that I can see where the mind shift to thinking like a buyer. I mean, I'm sorry, thinking about being a seller as opposed to being the buyer is a tough shift, but a shift that they have to make.(Bob) Yeah.(Butch) So Bob, one of the things you told me that really surprised me, you told me that only 4% of companies ever sell.(Bob) Man, it's a stat. It's out there. It keeps showing up year after year, survey after survey. It floors me every time I say it, every time I hear myself say it, 4% of companies. The The math on that is only about 20% are ever taken to market. Okay, so only about one out of five where there's an active attempt to go find a buyer, go find its next owner. And only about 20% of those that are taken to market actually ever sell. 20% of 20%, 4%. it's a shockingly low statistic. Yeah.(Bob) What just curious what what before you had heard that what would you have thought that that percentage might have been? 25, 30 maybe even 40. Yeah. Of the ones that are taken to market, that 25 percent figure could be realistic, but man, the vast majority just aren't. Now, I get it. The 80 percent that aren't taken to market, there's probably a good reason.(Bob) The business collapsed on its own, the owner died or got disabled. Maybe it was an internal transaction, like selling a book of business to an employee or a colleague. And so those never see the light of day, they never get marketed. But I used to go back and forth. Where's the bigger opportunity? The 80% that are never taken to market or the(Bob) 16% of all businesses where there was an attempt to take them to market, they just never got across the finish line. And I've kind of landed on the 16% because that's a situation where each one of those is a situation where somebody thought enough about the business to present it to the market, to try to find a buyer for it. So somebody thought or some team of people thought there was enough here,(Bob) there was enough value to transfer, there was enough attractiveness, that a buyer pool could be built. Let's take this to market, but for one or more reasons, it just never got across the finish line, it never closed. I've kind of landed on that. That's where in large part, the different types of advisors and(Bob) consultants that could come around the owner, doing things like you do at Fist Bump, could make the business more attractive, could make the business something that more buyers would take a look at, and almost to the point where it doesn't matter who owns the business, this thing's gonna keep running.(Bob) I think that's how you get that 4% higher, is to alleviate that number one buyer concern, which is what happens to this business if something happens to the owner?(Butch) So Bob, you've been in this space, I find this fascinating. You've been in the space for a long time. You wrote a book about it. What are the practical steps on the seller's side to getting to where they can become part of the 4%?(Bob) Can I plug the book for just a minute? Sure. That's why you're here. There it is. Exit Teams. Just go to Amazon. That's where we're reselling the paper version of it and the hardback. Just start typing in Exit Teams and you'll see it should be the first thing to pop up. The subtitle is Build a Team of Advisors for(Bob) your business sale to get a higher price. So let's start there. How can a business owner get more market ready? I think you start with understanding value. I think each owner needs to understand what that range of likely offers might look like if their business were taken to market.(Bob) There are different types of buyers. I get that. There are strategic buyers. There's financial buyers. There's institutional buyers. There's individual buyers.(Bob) And each of them could look at an opportunity, the same opportunity in different ways, and price it differently(Speaker 3) and build terms around it differently.(Bob) So an owner who understands value, I'll give you another stat, an owner who understands what a range of values might look like could put them in the 2% category. Okay, so roughly 98% of owners don't understand the value of what they've got. And again, that's one of those statistics that I, every time I say it, I get re-shocked all over again. That'd be like you or me, you know,(Bob) saving money for 40 years for retirement. And we never got a brokerage statement. We never got an IRA statement or however we were saving until six months out from retiring. That's what these business owners are doing to themselves by not understanding what true value looks like. The other thing I say is owners get their company more market ready by building a team of advisors. So they have a team of people on the inside of their company who work for them if they have(Bob) employees. They also should have a team of advisors outside the company who weigh in on a regular basis, the advisors who collaborate, often providing advice to the owner over long periods of time to optimize the company. So a team of advisors inside, a team of true advisors from the outside, a team of, I guess you could say, employee advisors on the inside. The next thing I say is optimize the company. Just start doing that hard work of making changes,(Bob) making decisions that impress a future buyer of your business. Build it so it almost doesn't matter who is running this business. And the next thing I say is to have that owner begin and complete the journey of thinking like a buyer.(Bob) And then finally, all that effort should result in a higher price for the business than they would have gotten otherwise. But it's a long process. People often ask me, how long should this take? How long should I give a team of advisors and(Bob) my internal people time to optimize my business? I would say two to three years, I think is the figure we hear the most, sometimes three to five years. Just real quickly, I think three years is probably the optimal number. I mean, specific situations make that different.(Bob) But three years is about enough time to impress a future buyer. Hey, you've made some changes that are going to stick in this company, and you've done this for three years. Three years on the seller side is not too long that you're going to lose their attention or cause them to think they're spending too much money making these changes to their business.(Bob) So three years seems to be kind of a happy place in the middle.(Butch) So Bob, what roles, you said they need a team of advisors. What are the roles that they need advisors for?(Bob) So if you're going to go to market, realize one thing. You're going to position the opportunity to the buyer pool and they're going to respond. And let's face it, the buyers are in, I won't say they're in ultimate and final control, but they hold a lot of cards. They get to decide if you get to sell your highly illiquid asset or not. And it is an illiquid asset. It is a concentrated holding in a small business that's not publicly(Bob) traded. These aren't shares that trade on a visible exchange, the buyer gets to decide what they're willing to pay at least. So, someone who understands how buyers think, someone who's in that role of representing a seller, I won't say against many buyers, but represents a seller in conversations and in negotiations with,(Bob) hopefully as few buyers as possible, but ultimately you're talking with buyers. Again, they're the ones that hold the cards. To me, that role is an MNA advisor. You can call that role a business broker if you want. But this is the person who, when they take a company to market, they hear from multiple buyers(Bob) what they think of this company. Oh, your business is too owner-centric. In other words, too dependent on the owner. Oh, your revenue is not contractualized. Or you've got too high of a concentration among too few clients. Or your financial know, your financials are in poor shape. So when you take a company to market, if you haven't cleaned up these problems beforehand, you're going to hear them from the buyer pool. No doubt. It's just, it's inevitable. In some situations, I think another person, a seller would want on the team is a fractional CFO.(Bob) You know, someone that can come in. I did a post on LinkedIn this morning, someone that can come in and augment the role of a CPA, an outside CPA that's, you know, usually doing tax compliance work. An outside CFO can come in and maybe and preferably with some industry experience know how to make a company run more optimally than it's currently on track to do. I think someone else that you probably have to have on that team is a transaction attorney. Too often attorneys are brought in at 1130 p.m. and the and we're all trying to get the deal done at midnight. So I would encourage owners involve transaction attorneys,(Bob) just general business law attorneys as soon as possible. Because sometimes things have to be done legally. Sometimes things have to be done contractually. Think of non-disclosure agreements with employees, non-competes. Think of, you know, contract language that you might want to have updated to reflect the ability to transfer that(Bob) business, those accounts to the buyer in the future. That ability may not exist in the present. It takes an attorney to get, you know get some of these changes done. So that's one of those integral folks on the team as well. In your space, I would say anybody that can come in and help the business. And this is like fractional marketing people and sales people as well. Anybody that can come in and help the owner build a machine so that the owner can step back more and more and more(Bob) and the machine can just keep running itself. Basically, we're talking about reducing owner dependence as much as possible. And of course, this issue of owner dependence is more common among smaller companies. But if you intend on selling,(Bob) you've got to think like your future buyer.(Butch) I would assume it's the role of the M&A advisor. I would think the biggest problem you would have is the owner not understanding that he is really the asset of the company and without him, that machine isn't going to keep going. How do you overcome that hurdle or can you?(Bob) Yeah, can you? That's the big question. So I spend a lot of time on the front end trying to understand and answer, try to get an answer to that question for sure. When someone makes an introduction to their client or friend or whatever, two things happen. My mind immediately goes to the buyer pool. How difficult or easy will it be to build a buyer pool?(Bob) And the second thing I'm thinking about is, is this a business that is too reliant that is really just a lifestyle business for the owner? Is this, uh, you know, is this the owner's personal ATM machine, uh, where they're running, you know, a lot of stuff through the company? Is the owner, you know, the, the, what do they say? the chef, cook, and bottle washer all at the same time? These things, these very hard issues, we gotta look at them up front. And sometimes the conclusion is this business is too owner dependent and(Bob) likely will still be based on the age of the owner, the stage of the business's life cycle, the state of the industry, the owner's cash reserves, the owner's willingness. Back to my point about optimism mixed with stubbornness, the owner's willingness to listen to outside advisors. So I often say, Mr. Miss Owner, if you have enough time, money, the right people, and your own health, you know, we can make improvements, but we need to(Bob) have a willingness to do these things as well. Time, money, the right people, and your own health. And your own health has been a pretty big issue here lately with a lot of businesses still owned by boomers.(Butch) Yeah, I get it. Hey, I want to say hello to Brandon Lee and Frank Palomero who are in the chat with us. If you guys have any questions, please just type them in and we'll do the best to get the answers. All right, Bob, let's talk about the thing everybody's facing right now. What are the, you know, as we're evolving and trying to bridge these generations together, digital, social media and especially AI has changed things for everybody. How is the M&A space evolving to those kind of changes?(Bob) I can think of at least two ways. One, and most people would not see this because they're not in the M&A world, but there are beginning to be tools being developed to help my job, make my job easier. I just had a demo of one a few days ago, and it looks impressive. And it looks like something I'd have to pay somebody a 100,000 a year plus to do(Bob) with this tool's current capabilities. It's all about search. It's all about search. It's all about the right prompts. It's all about access to large amounts of data. And AI cuts through all that. Very effortless, well, I won't say effortlessly.(Bob) You gotta have the right platform and tools to do it. The second way that I think AI is, and this is more of a long-term play, and we really can't see where this is going, is how are companies themselves going to use AI? I was on a networking call this morning(Bob) and I got paired up in a breakout room with someone who goes into companies as small as 10 and 15 million in annual revenue and helps them use AI in its current state to do business better, to do business smarter, cheaper, faster.(Bob) So it's already beginning to come downstream a little bit. It kind of reminds me of maybe U2, the internet in the late nineties. You know, it was new, it was coming out of the military or academia, wherever it started, and it was beginning to find its way into commercial enterprises. And then people logged on with, was it AOL and other dial-up access services. We were beginning(Bob) to explore what an AI, excuse me, an internet ability would give us. And at the time, right, it was just a glorified phone book or, you know, it let us see glorified brochures of companies' websites. It was very much in its infancy in terms of commercial application. AI feels like that now, except it doesn't even feel like it's there yet.(Bob) It feels like it's so new and to your point, it's moving so quickly. We're week by week, day by day, trying to figure out how this applies to anybody. I've seen a graphic posted on LinkedIn by more than a few people over the past couple of months. It was kind of one of those square graphics in a LinkedIn post and in column, the first column, it said, these are your classically defined kind of standard job titles that exist in the American economy. The next column said, these are the percentages of those businesses that are probably going(Bob) to go away or be replaced by AI within, you know, a few years, say four or five years. Next column was the percentage of these occupational titles that are going to be gone within one generation. And then the final column off to the right, the percentages of these occupations that will be gone within two generations. And it was, it was, at least the projections were scary, whether we get there or not, you(Bob) know, remains to be seen. But hopefully AI just ends up augmenting human thought and not replacing it. That's my, that's my hope. And I would think we get there, between proper regulation and understanding of it and commercial application, I would hope we get there.(Butch) So I would think that a scary thing for the buyer with the world we live in now with AI, with social media, the seller can find out about anything they want to find out about the buyer.(Bob) Yeah.(Butch) Without much difficulty.(Bob) Interesting. Yeah, I could see that. I could see that, you know, kind of turning the tables, tipping the scales, you know, restoring the balance between buyer and seller. Still got to do a deal though. Still got to get,(Bob) you know, agreement on pricing and terms. We'll see. Yeah.(Butch) So, Bob, when you get down, you know, you've got a willing buyer, you've got a willing seller, and the only thing that's out there is the financial side. What happens to make that happen? What has to happen to make that happen?(Bob) You're talking about make a deal happen, get past just that financial level of due diligence?(Butch) Yes.(Bob) Yeah. I find the financials, again, back to my LinkedIn post from this morning, financials are the first place that buyers go to every time. It's their first screening tool and you can't blame them. The financial statements that we're talking about, profit and loss statements, we're talking about balance sheets, which most sellers, a lot of sellers don't understand fully. We're talking about(Bob) cashflow statements and other lesser types of accounting statements. Financial statements combined, what are they? They are a report card on what management has done with shareholder resources. I know that sounds a bit wonky, but it is. It's a report card. Here's what for, you know, the years presented. Here's what, here's what was done with the money that was invested or borrowed. And they tell a tale and they tell a story and they either tell, you know, either a comedy, they tell a love story, they tell a horror story, they tell a(Bob) drama, you know, they will tell a story of some kind. Your job as a potential seller is to, over time, paint as clear a picture as possible and as much of an understandable, consistent story as possible. That's how you get buyer interest. So when they get past their first screen, they say, yeah, there's enough here in these financials for us to keep looking(Bob) because it's kicking off enough cash, seems to be operated well, its margins look good, you know, in comparison to benchmarks or what other companies they might've seen. Then you start getting into the, you know, the getting into the further financial, the more granular things,(Bob) then you start getting into the non-financial types of due diligence. And I think I made this point at the open, if not, it's worth saying. And that is that the due diligence lists are getting longer from buyers and it's getting more detailed and they're taking longer to get through it. So sometimes people ask me how long to get a company sold and(Bob) pre COVID pandemic I might have said eight, ten months, but now it's more like 12 plus in many cases, 12, 14 months. Buyers are getting more selective. They're getting more, I won't say fearful, but they just want to understand the risks that they're being asked to inherit.(Butch) I understand. Well, Bob, is there anything we haven't talked about you'd like to tell us?(Bob) You know, for owners and any advisors to owners listening or watching this on the live or the replay, just start now. Just start understanding value of your business or helping if you have clients that run businesses, help them understand value today. Get be part of that 2% elite category of business owners who do. Start thinking like a buyer, build that team of advisors around you. Just start today.(Bob) If you haven't already started, please start today.(Butch) Great, Bob, I really appreciate you being on the show. Where can people find you?(Bob) Sure, you can find me at, well, phone call is always preferable. 770-633-1083. I'm on LinkedIn. I think you saw the scroller there across the bottom a few minutes ago. I'm on LinkedIn. Just start typing in Bob Tankis. You should see it. Bob at exitteams.com would be a good email address.(Butch) Yeah. One of those three ways. Great. Well, I appreciate you being here today, Bob. Before we wrap up, I just want to say one. I just want to say two things. One, we named the show Bridging Generations in Sales and Outreach because we want baby boomers, older Gen Xers to understand that digital, social media, LinkedIn, all that stuff can be confusing for us because I am part of that group. But it just takes a little time, a little study. There are plenty of people that you can rely on to help you there. One thing hasn't changed. I've been in business for 40 years and I was taught people want to buy from people they know, like and trust from day one and that's still true and you know how to do that. So remember this(Butch) is about evolving not starting over. Appreciate you being here today and you can reach out to Bob, you can reach me at butch at getfistbumps.com and on LinkedIn at Robert Butch Nicholson. Thank you for being here. can reach out to Bob, you can reach me at butch at getfistbumps.com and on LinkedIn at Robert Butch Nicholson. Thank you for being here.(Bob) This is awesome. Take care, everyone. Thanks.