The Real Costs of Selling Your Business: A Founder's Guide Selling your business will likely cost 5-15% of the total deal price. This is the tactical breakdown of where every dollar goes, from M&A advisor fees to the hidden costs you haven't considered. TL;DR: Expect 5% to 15% of your company's sale price to be consumed by transaction fees. The largest cost is your M&A advisor (typically 3-6% of enterprise value), followed by legal fees (00k-$300k+), and accounting for a Quality of Earnings report ($30k-$75k+). Preparing for these costs and managing them proactively is critical to maximizing your net proceeds. Key takeawaysBudget 5-15% of your target sale price for total transaction costs.Hire your M&A advisor based on track record, not just the fee percentage.Commission a sell-side Quality of Earnings (QoE) report before you go to market.Your M&A legal fees will likely be 00k-$300k on a sub-$50M deal.The biggest hidden cost is your own time and distraction from running the business.Start prepping 12-24 months before a potential sale by cleaning up financials and legal records. Your Exit Will Cost You 5-15% of the Sale Price Before you fixate on a headline sale price, internalize this: selling your business is not free. Accessing that life-changing liquidity will cost you. For most tech companies and founder-led businesses, expect 5% to 15% of the final enterprise value to be eaten by transaction costs. On a 0M deal, that’s M to $3M that you will not receive. On a 00M deal, it could be $5M to 5M. These are not minor deductions; they are significant cash outflows that determine your net proceeds. The good news is they are predictable. This guide breaks down every line item, from the obvious to the non-obvious, so you can model your exit accurately and avoid expensive surprises. The Biggest Check You’ll Write: Your M&A Advisor The single largest expense, by far, will be the fee you pay the M&A advisor or investment banker who runs your sale process. A great advisor doesn't just run a process; they create the market that gets you the best possible price and terms. A mediocre one can leave millions on the table. This is not the place to be penny-wise and pound-foolish. How M&A Advisor Fees Work Most M&A advisory engagement letters have two core components: 1. The Monthly Retainer: A fixed fee paid during the 6-12 month sale process. This covers the significant upfront work of building the financial model, writing the Confidential Information Memorandum (CIM), developing buyer lists, and managing initial outreach. It ensures the bank is compensated for their time, even if a deal doesn't close. Typical Cost: 0,000 - 5,000 per month. Founder Tip: The retainer should always be 100% creditable against the success fee at closing. If you paid $75,000 in retainers and the calculated success fee is $600,000, you should only pay an additional $525,000 at close. If a bank argues this point, it's a red flag. 2. The Success Fee: The majority of the compensation, paid only if and when the deal closes. This is almost always calculated as a percentage of the total enterprise value. Continue reading the full guide Related guidesHow to Sell Your Startup: A Founder's Guide to M&A AuctionsM&A Tax Strategy for Founders: A Guide to Stock Sales, Asset Sales, and QSBSA Founder's Guide to Hiring an M&A AdvisorHow to Sell Your App: A Founder's Guide to an AcquisitionAcquisition vs. Acquihire: A Founder's Guide to Startup ExitsExit Strategy: A Founder's Guide to Building an Acquirable Startup Read on Startup Fundraising · More articles · Browse the Library More from Startup FundraisingVideos — Top Reasons Why Startups SucceedFundraising Failure Map Structural Errors That Cost Deals B86122Most Active Biotech Investors In San Diego 2026Ai Infrastructure In Seattle Wa — Most Backed Startups 2026Austin Tx — State Of Funding 2026Coinvestors — Meritech Capital Partners And Sequoia Capital 2026Ai Infrastructure — Top Coinvestor Pairs 2026Notabene — Alternatives 2026Electra — Investor Syndicate 2026F Prime — Alternatives 2026Andreessen Horowitz — San Francisco Ca Portfolio 2026Stepstone Group — Portfolio Companies 2026137 Ventures — Ai Infrastructure Portfolio 2026Meritech Capital Partners — Portfolio Co Investors 2026Healthtech — Most Active Firms 2026Investor Landscape 2026Biotech — State Of Investing 2026Healthtech In San Francisco Ca — State Of Funding 2026 Library homeFull library indexArticlesHomeInvestor directoryFounder directoryCompany funding databaseResearch hubPricing State Of Investing 2026State Of Investing 2026State Of Investing 2026State Of Investing 2026State Of Investing 2026State Of Investing 2026Evan Loomis Ec068aEvan M Roth Adeef8Evan Osborn 55113dEvan Pritchard 764474Evan T Decorte 02f490Evan Zemsky 7541dfPedro Marcal 83bbf3P E Global Llc 439658Pelham Capital Ltd 7530b3Peng Cheng F5ed38Pep Asset Management Ultimate Gp Llc 0594ddPerbak Global Market Neutral Gp 650e80
