โYouโve probably heard it before: My company is worth X because thatโs what similar companies sold for.
Or this one: Iโll think about selling when Iโm ready to retire. The right buyer will show up.โ
These beliefs sound reasonable. Theyโre also some of the fastest ways to derail an M&A deal before it even gets traction.
The truth is simple: M&A doesnโt reward hopeful thinking.
It rewards preparation, clarity, and realism.
In my recent conversation on the This Is M&A podcast, we dug into what actually kills deals behind the scenesโoften after the handshake, when founders think the hard part is over. After nearly two decades helping companies navigate growth, exits, and post-close realities, Iโve seen the same patterns repeat themselves.
Here are a few hard truths every founder and executive team needs to understand before heading toward an exit.
Myth #1: Valuation Is Fixed
One of the most dangerous assumptions in M&A is believing your company has a single, objective value.
It doesnโt.
Your company is worth what a specific buyer is willing to pay, under specific circumstances, at a specific moment in time.
Context matters:
- Who the buyer is (strategic vs. PE)
- What problems you solve for them
- How clean and predictable your operations are
- How much risk they perceive post-close
Valuation isnโt a number you โdeserve.โ
Itโs a strategy you earn by aligning your business with the right buyer narrative.
Myth #2: The Deal Is Won at Close
Many founders breathe a sigh of relief once papers are signed.
Private equity buyers donโt.
For PE firms, close is the starting line, not the finish.
High multiples arenโt paid to โsee what happens.โ Theyโre paid with the expectation of:
- Immediate execution
- Tight operational discipline
- Leadership teams that can deliver under pressure
Miss targets, lose key talent, or stumble through integrationโand value erodes fast. In many cases, the biggest financial consequences show up after the deal is done.
Myth #3: Leadership Will โFigure It Outโ Post-Close
Founders often underestimate the leadership gap that emerges after a transaction.
What worked in founder-led growth doesnโt always work under PE ownership or within a larger platform company. Operational chaos, missed budgets, unclear accountability, and team churn are silent value killersโand buyers see them coming long before sellers do.
Strong deals require:
- Clear operating cadence
- Leaders who can scale beyond instinct
- Teams prepared for a very different level of scrutiny
If that foundation isnโt in place, buyers discount aggressivelyโor walk away.
Myth #4: Buyers Think Like Sellers
They donโt.
Sellers focus on:
- Legacy
- Timing
- Emotional milestones
Buyers focus on:
- Risk
- Upside
- Speed of execution
When sellers donโt understand how buyers think, friction builds. That friction turns into deal fatigue, mistrust, and stalled momentum. In competitive processes, itโs often the difference between a premium outcome and a dead deal.
The Bottom Line
Most failed deals donโt collapse because of price alone.
They collapse because expectations, preparation, and reality never aligned.
If youโre building toward an exitโwhether thatโs this year or three years from nowโthis conversation is worth your time. Thereโs no pitch. Just hard-earned lessons from deals that worked, and deals that didnโt.
Sometimes, avoiding the wrong assumptions is what saves you millions.
๐ง Listen to the full episode
You can also find it on YouTube, Spotify, and Apple Podcasts.
