Welcome back to another edition of The Wise Exit newsletter. Here's what we're covering this week:

Let's dive in.

Run Your Business Like You're Always in an Earnout

One of the most common things I hear from founders after they've gone through an exit is some version of this:

"I didn't realize how much more I had in me until I had to prove it."

And what they're usually talking about is the earnout period.

For anyone unfamiliar, an earnout is a structure where a portion of your sale price is tied to hitting certain performance targets post-closing. You've sold the business, but you're still running it, and now there's real money on the line depending on how well it performs over the next one to three years.

What's interesting is what happens to founders during that period.

Suddenly, everything sharpens. The financials are cleaner. The processes are tighter. Decisions get made faster. The team is more aligned. There's a level of discipline and focus that, if you're being honest, probably wasn't always there before.

And almost every founder looks back and thinks the same thing: I wish I'd been running it like this all along.

Because that extra gear was always there. The earnout just forced them to find it.

Here's what running your business in "earnout mode" actually looks like before a deal is ever on the table:

1. Your financials tell a clear story. Not just that you're profitable, but why. Buyers (and earnout structures) don't care that your taxes are filed. They care about the narrative your numbers tell. Clean books, documented revenue streams, and margins you can actually explain are the baseline.

2. You're tracking the metrics that matter to a buyer. Revenue is one number. But what's your customer concentration? Your gross margin by product line? Your cost to acquire a customer? Founders in earnout mode know these numbers cold. Most founders preparing to sell don't, until it's too late to do anything about them.

3. You make decisions faster. Earnouts have deadlines. That urgency changes how founders operate: fewer endless debates, less analysis paralysis, more decisive action. Running like you're in an earnout means treating every quarter like it counts, because eventually, it will.

4. You operate like a buyer is always watching. Every expense decision, every client contract, every hiring choice. Not because you're paranoid, but because that discipline builds a fundamentally stronger business that shows up differently in any room.

That's the whole point of starting sooner. Not just to be ready when a buyer shows up, but to build something that actually deserves a premium outcome.

Reply to this email if you want to talk through where your business stands today.

1️⃣ If a buyer reviewed your last three years of financials tomorrow, would the story be clear?

2️⃣ Do you know your gross margin by product line or client?

3️⃣ What happens to your business if you take a two-week vacation and go completely dark?

4️⃣ Are you tracking the metrics a buyer would actually care about, or just the ones that feel good?

5️⃣ What would change about how you run the business if you knew a buyer was watching every decision?

☑️ Pick three metrics you don't currently track and start tracking them: Customer concentration, gross margin by line, or cost to acquire a customer are good starting points. You can't improve what you're not measuring, and a buyer will ask about all of it.

☑️ Identify one process that only you can do right now and start documenting it: This week, just one. Write down how it works, who could own it, and what it would take to hand it off. That's how you start removing yourself from the equation.

☑️ Pull your last 12 months of financials and read them like a buyer would: Not your accountant's lens. A buyer's lens. Where would they have questions? Where does the story get murky? Those are the areas to clean up now, not during due diligence.

That's all for this week. The founders who get the best outcomes aren't the ones who prepared the hardest at the end. They're the ones who were already running like something was on the line.

If you want help figuring out where to start, reply to this email or contact us here. We're always happy to walk you through your options.

Talk next week,

Brian Dukes
Managing Partner at Exitwise