Exit Readiness
Is the value built during the hold legible and defensible to the next buyer?
Window
12 to 18 months before a process
Structure
One fixed fee
Output
A pre-process punch list
What a buyer discounts
A buyer pays for two things: earnings they can verify and a multiple they can justify. The quality of earnings covers the first. What they find when they look at how the platform runs sets the second. This work is about the second.
During the hold, the people who ran the platform learned to read it. The platform never learned to explain itself.
The next buyer is another sponsor running the diligence you run, and they arrive with none of your context. They will not take the team's word for what the systems cannot show, and they will not take an adjusted EBITDA on trust. What they cannot verify, they discount.
A buyer tests three things, in order: whether the CEO and the CFO separately name the same reason the business grew, whether the numbers reconcile to a system without anyone in the room, and whether the performance is a repeatable process or a few people you cannot afford to lose. Sell-side prep can fix the first and reconstruct much of the second. The third is where the price is set, and it cannot be assembled for the occasion.
What it finds
The read runs those tests before a buyer does. What holds: the growth the team can trace to a decision, the numbers that reconcile to a system of record, the builds with a benefit ledger behind them, and the performance that keeps running when the people who built it are not in the room. What does not: referral and site concentration nobody has priced, rate and mix drift, provider retention and the comp structure under it, coding and compliance exposure, a growth number that only one person can explain, an integration backlog.
What the read looks like
A buyer’s first requests, run against your own reporting before anyone outside sees it. Some questions the team can answer on demand, some it can assemble with rework, and some it cannot answer at all. That last group is where the price gets marked down. This read finds it twelve months early.
Illustrative exampleExit ReadinessWhat it covers
It covers the four areas a platform's value moves through: where volume comes from, what each unit is worth, what each unit costs, and what a deal actually delivers. Underneath all four sits the base a buyer will ask to see: the planning cadence, the decision rights, the board reporting, and the benefit ledger. The findings direct the quarters you have left, and the record is what the CIM and the quality of earnings later draw on.
When to run it
Twelve to eighteen months before a process starts, early enough that your team can still fix what the read finds: document the systems, close the gaps, and land a targeted build before diligence begins. After the process starts, there is no time to change what the buyer will find. Most of the gap between what you ask and what a buyer offers belongs to the market. The part that belongs to you is the distance between what the platform does and what a buyer can verify.
If the numbers already reconcile to a system without anyone in the room, you can skip this.
What happens next
The read separates what needs documenting from what needs building. Documentation is usually your team's work and the faster half. The builds are scoped like any other: fixed scope, agreed before they start, run through the Transformation Office. Or take the punch list and run it with your own team. Either way the fixing happens on your schedule rather than in a data room.
What would diligence find?
Tell me where the platform is in the hold and when you expect a process. I'll tell you what I'd look at first, and whether there's still time to fix what it finds.
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