A typical structure is cash at closing, a rolled-over equity stake in the acquiring platform, and sometimes an earn-out tied to performance targets. The rollover is genuinely valuable if the platform grows and exits well — owners sometimes make more on the second sale than the first. It is also genuine risk: your rolled equity is a minority stake in a company you no longer control, and it may be illiquid for years. When comparing two offers, compare cash at closing first, then value the rest separately with clear eyes. A larger headline number with less certain cash is not automatically the better deal.
PE tends to fit best when your business has real scale, a management team that can run without you, and a growth story the buyer can accelerate with capital. It also fits owners who want partial liquidity now while staying involved for a few more years. It fits poorly when you want a clean break, when the business depends almost entirely on you, or when you would find it difficult to be an employee of a company you used to own. That last point is not a small consideration — it is the most common source of regret we hear.
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Ask what fund they are investing from and how far into its life it is, because that shapes their timeline. Ask how many similar businesses they have bought and to speak with an owner who sold to them. Ask precisely how the earn-out is measured and who controls the decisions that affect it. Ask what happens to your staff and whether roles are consolidated. And ask what the exit plan for the platform looks like. Buyers who answer these plainly are usually good partners; buyers who deflect them are telling you something important.
It can be, particularly if your business has scale, management depth, and growth potential the buyer can fund. PE buyers often pay the most and run professional processes. The risks are structural: earn-outs and equity rollover mean part of your outcome depends on post-sale performance you no longer control. Understand the structure before the number.
Not without competition and not without advice. An unsolicited approach means someone has identified your business as valuable, which is useful information. But a buyer negotiating against nobody has no reason to improve price or terms. Owners who run a quiet, competitive process almost always end up with better economics than those who negotiate alone against a professional acquirer.