3 Red Flags That Scare Away Buyers (And How to Fix Them)

Welcome back to another edition of The Wise Exit!

In today's issue, we're covering:

1. 3 Red Flags That Scare Away Buyers (And How to Fix Them)

2. 9 Steps to Successfully Sell Your Internet Business

3. The Truth About Reinvesting Profits

Let's dive in!

3 Red Flags That Scare Away Buyers (And How to Fix Them)

Customer Concentration

When too much revenue comes from too few customers, buyers see risk. Just one client departure could crater your revenue. Often, sophisticated buyers won't even look at businesses where a single customer represents more than 15% of revenue. Some won't touch anything above 10%.

How to Fix It:

• Create incentives for your sales team to prioritize portfolio diversification

• Launch targeted campaigns to acquire customers in underrepresented segments

• Implement a key account strategy that prevents any client from exceeding 10% of revenue

Fix this, and you'll not only attract more buyers but also command a higher multiple for your more stable revenue base.

Founder Dependency

If you're the only one who can close deals, maintain key relationships, or solve critical problems, you haven't built a business — you've built yourself a job. Buyers want systems and teams, not hero founders.

How to Fix It:

• Create detailed playbooks for every key process you manage

• Gradually transition client relationships to your leadership team

• Take progressively longer leaves to prove the business runs without you

Successfully removing yourself as a bottleneck will show buyers that they're acquiring a self-sustaining asset, not just your personal Rolodex.

Outdated Technology

Legacy systems are inefficient, and they signal massive future capital requirements to buyers. Nothing kills deals faster than the specter of seven-figure tech upgrades looming on the horizon.

How to Fix It:

• Start migrating to cloud-based, scalable solutions

• Develop a clear technology roadmap with prioritized upgrades

• Document all integration points and data flows for a seamless transition

Modernize your stack now, and you'll transform a major buyer objection into a compelling selling point for your exit.

These issues compound over time, so start addressing them now.

By the time you're ready to sell, it might be too late.

The good news? Every red flag has a solution if you're willing to act.

Need help? Get in touch.

Featured Blog 📰

Feeling overwhelmed about selling your internet business?

Our comprehensive guide breaks down the entire process into nine manageable steps, from preparation to final integration.

In our latest blog post, we cover:

• How to develop the right exit mindset

• Essential preparation steps

• Valuation and improvement strategies

• Building your M&A dream team

• Keys to successful negotiation

Read "9-Step Guide to Selling Your Internet Business Successfully" on our blog.

M&A Tips from Brian Dukes 💡

Founders: Is your business serving you, or are you serving it?

Think about it.

Some founders work 80-hour weeks (and weekends) and pay themselves a minimum wage, all for a "someday" exit, not really understanding how to choose a path that gets them there.

Typically, there are 3 paths once you've hit profitability:

Read the full post on LinkedIn.

That's all for this week!

Remember, fixing red flags takes time, but it's always worth the investment.

Best,

Brian Dukes