The M&A Timeline: What Founders Should Expect

One of the most common questions we hear from founders considering a sale: "How long will this actually take?"

The honest answer: longer than you think, but there are ways to accelerate the process. This guide breaks down the typical M&A timeline and what happens at each stage.

The Short Answer

Most transactions take 6-12 months from initial engagement to close. However, this varies significantly based on preparation, deal complexity, and buyer type.

Phase 1: Preparation (4-12 Weeks)

Before going to market, you'll need to:

Financial Preparation

• Compile 3-5 years of historical financials
• Normalize for owner adjustments
• Build a forward-looking financial model
• Consider a sell-side Quality of Earnings

Legal Preparation

• Clean up cap table issues
• Review and organize key contracts
• Address any known legal matters
• Ensure IP assignments are complete

Operational Preparation

• Document key processes
• Identify key person dependencies
• Prepare customer concentration analysis
• Gather market and competitive data

Phase 2: Marketing & Outreach (4-8 Weeks)

Confidential Information Memorandum

Your advisor will prepare a CIM that tells your story:

• Executive summary and investment highlights
• Company overview and history
• Market analysis and competitive positioning
• Financial performance and projections
• Growth opportunities

Buyer Outreach

• Develop target buyer list (strategic + financial)
• Sign NDAs with qualified buyers
• Distribute CIM and gauge interest
• Schedule initial calls and meetings

The CIM is your first impression. Make sure it answers the questions buyers will ask and presents your company's story compellingly.

Phase 3: Management Presentations (3-6 Weeks)

Interested buyers will want to meet you and your team:

What to Expect

• 2-3 hour in-person or video meetings
• Deep dive into business model and financials
• Q&A on strategy, team, and growth plans
• Site visits for location-based businesses

How to Prepare

• Practice your presentation multiple times
• Anticipate tough questions
• Prepare your management team
• Have backup materials ready

Phase 4: Letter of Intent (2-4 Weeks)

What's in an LOI

• Purchase price and structure
• Key terms and conditions
• Exclusivity period
• Due diligence timeline
• Expected closing date

Negotiating the LOI

Key terms to negotiate:

• Earnout structures and triggers
• Working capital targets
• Rep & warranty insurance
• Escrow and holdback amounts
• Employment terms

Phase 5: Due Diligence (6-10 Weeks)

This is where most of your time goes:

Financial Due Diligence

• Quality of Earnings analysis
• Working capital normalization
• Revenue quality review
• Cost structure analysis

Legal Due Diligence

• Contract review
• IP verification
• Employment matters
• Regulatory compliance

Operational Due Diligence

• Customer interviews (carefully managed)
• Technology assessment
• Facility reviews
• Integration planning

Phase 6: Definitive Agreement & Close (4-8 Weeks)

Documentation

• Purchase agreement negotiation
• Disclosure schedules
• Ancillary documents (employment, non-compete, transition services)
• Third-party consents

Closing Conditions

• Regulatory approvals (if needed)
• Third-party consents
• Financing confirmation
• Rep & warranty insurance binding

Timeline Accelerators

Want to move faster? Focus on these:

1. Pre-transaction preparation — Start 6-12 months before going to market
2. Sell-side QoE — Preempts buyer questions
3. Clean data room — Organized and complete from day one
4. Buyer selectivity — Focus on qualified, motivated buyers
5. Clear decision-making — Know your priorities and deal-breakers

Planning your transaction timeline? Contact us to discuss preparation strategies.