Most owners want to transition. Few are ready.

A generation is planning what comes next

In the Exit Planning Institute's 2023 national survey of 1,162 owners, 75% said they would like to exit their business within the next 10 years. The same research estimates that as many as 4.5 million privately held businesses, and $14 trillion in wealth, could change hands by 2033.

For most of these owners, the business is the largest asset they have. It also carries their name, their employees' livelihoods and years of relationships with customers and suppliers.

Few are ready

In the same survey, only 13% of owners had a formal exit plan. The rest are heading toward one of the biggest decisions of their lives without a written path.

In practice, "not ready" rarely means an owner hasn't thought about it. It usually looks like this:

• The business still depends on the owner for key customers, pricing or decisions.
• The numbers live in the owner's head or in spreadsheets only they fully understand.
• There is no clear successor, inside the family or the management team.
• The owner has never had the business valued, so expectations are a guess.

Why it matters

An unplanned transition costs owners in three ways.

• Value. Buyers pay for a business that runs without its owner. When too much depends on one person, buyers discount the price or tie more of it to future results.
• Choice. Without time to prepare, owners often sell on the buyer's schedule, to whoever is ready, rather than to the partner they would have chosen.
• Legacy. The things owners care about most, such as their people, their name and their customers, are hardest to protect when a transition is rushed.

None of this requires selling soon. It requires starting early, so that when the time comes, the owner is choosing rather than reacting.

Where to start

Four steps an owner can take this year, whether a transition is two years away or ten:

1. 1
   Decide what a good outcome looks like. Timing, your role afterward, and what matters most: price, your people, your name, or all three.
2. 2
   Get a realistic view of value. A professional valuation turns a guess into a starting point and shows what drives the number up or down.
3. 3
   Make the business less dependent on you. Document how key work gets done, and hand customer relationships and decisions to your team.
4. 4
   Get your numbers clear. Clean, timely financials and a few measures you track every month make the business easier to run and easier to value.

The bottom line

The best transitions don't just change ownership; they prepare the company for its next chapter. That preparation is what we focus on at Daedalica Capital, with owners who are planning ahead as well as those who are ready now.