What Founders Wish They'd Known Before Hiring Their First M&A Advisor

Most founders sell one company. A few sell two. Almost none sell three. The pattern is that founders go through this process when they are least equipped to evaluate it. By the time they have learned what they wish they had known going in, the deal is closed and they will not need the knowledge again.

Talking to founders who have been through it, the same lessons come up over and over. None of them are secret. None of them are technical. They are the kinds of things bankers do not tell you in the pitch because telling you would not help close the mandate. Here are the ones that show up most often.

The pitch is the best the firm will ever look

The senior partner who walks into your office, gives a polished hour-long presentation, and leaves with a steak dinner reservation is the best version of that firm you will ever see. That partner will not be in the data room reviewing buyer questions in week 14. That partner will not be on the late-night calls with the buyer's CFO in week 28.

Founders consistently report that the pitch experience oversold the actual engagement experience by 30 to 50 percent. The fix is to discount the pitch accordingly, and to spend more time meeting the day-to-day team. The VP who will run the process is more important than the partner who pitched it.

Most founders do not negotiate the engagement letter enough

Engagement letters are presented as standard documents. They are not. Every clause is negotiable. The fee percentage, the retainer, the tail, the term, the expense cap. Every single one of those was set by the banker in a way that was favorable to the banker, on the expectation that you would not push back.

Founders who pushed back hard on the engagement letter consistently say it was the highest-leverage hour of the process. An hour of negotiation can save hundreds of thousands of dollars in fees and prevent multi-year disputes on the tail. Our engagement letter guide covers every clause.

The first IOI is rarely the eventual winner

Founders new to processes get excited by the first IOI. "We got an offer for X million, that is amazing." The first IOI is anchoring, but it is not the deal. Real processes shift between IOI and LOI. The buyer who looked like the front-runner in week 9 often gets passed by another buyer in week 14. The number on the first IOI is almost never the number that ends up on the wire.

Founders who have been through this report that emotional management of the IOI phase is one of the hardest parts of the process. The temptation to focus on the highest IOI and start mentally spending it is enormous. The discipline is to not. Let the process play out. Let the LOIs come in. Decide on the totality of structure, price, and counterparty, not on the prettiest IOI.

Diligence is more painful than you can imagine

Founders are not prepared for the volume and intensity of confirmatory diligence. The buyer's team will ask questions you did not know were possible. They will surface historical issues you forgot about. They will want documents you cannot find. The pressure is sustained and exhausting for 60 to 90 days.

Practical advice that founders consistently endorse: get your data room together before launching the process, not during it. A well-organized data room cuts diligence time by weeks and reduces buyer leverage. The work you do upfront pays compound returns later.

Your banker is not your therapist

Selling a company is emotionally intense. The temptation is to lean on your banker as a counselor, calling them to vent at moments of doubt. Resist. Your banker is paid to close deals. Their emotional bandwidth is finite and their incentives are not aligned with your mental health.

Find someone else for the emotional dimension. A spouse, a friend who has been through it, a therapist, a board member who is not on the buyer side. The banker should be the operator, not the support system.

References lie, but they lie in patterns

Founders going into pitch meetings often ask for references. The references are almost always glowing. This is not because the references are dishonest; it is because the banker only gives you references from happy outcomes. The unhappy founders are not on the reference list.

What references can tell you, even with positive bias: the rhythm of how the firm communicates, the staffing level, the discipline of the process, how the banker handled a moment of stress. Ask specifically about the bad moments. Every deal has them. The way the banker behaved during those moments is the real signal.

And read founder-verified reviews on BankerNotes that are not curated by the banker. Reviews from founders who picked the firm themselves, including those whose deals did not close, are different from reference calls.

The deal you sign is not the deal that closes

The LOI you sign in week 19 is not the deal that closes in week 35. Between LOI and close, buyers consistently push to retrade on price, structure, escrow, indemnification, and rep-and-warranty terms. Some retrading is normal. A lot of retrading is a sign that the buyer was not serious at LOI.

Founders are sometimes surprised by retrading and feel betrayed. The realistic posture is: assume some retrading will happen, and have your banker model the worst-case retraded deal at the moment you sign LOI. If you would still take the deal at the worst-case structure, sign. If you would not, do not.

Closing day is not what you imagined

Founders imagine closing day as a climactic event with a ceremonial signing. The reality is a series of administrative tasks: signature pages getting collected, wires sitting in escrow until conditions are released, employment agreements being countersigned, announcements going out at a specific moment for press purposes.

The emotional release usually does not come on closing day. It comes a few days or a few weeks later, when the wire has actually cleared and the announcements are public and you wake up one morning and realize the company is no longer yours to run.

Plan for this. The transition is emotionally significant in a way that the closing mechanics are not.

You can still influence the buyer experience post-LOI

Many founders feel powerless after LOI. They have given up exclusivity. The buyer can take their time, retrade, push the close date. This is partly true, but founders have more leverage than they think.

Specifically: the buyer is also under pressure to close. Their CFO has already told their board they will close at LOI terms by a certain date. Slipping costs the buyer too, in the form of internal credibility. A banker who knows how to use this is worth their fee in the post-LOI phase.

Founders who pushed back hard on retrading attempts at LOI consistently report better outcomes than founders who accepted retrades passively. Push back. Make the buyer earn the retrade with evidence, not just an assertion.

After the close, the next chapter is unstructured

Founders sometimes assume that after the close, life will be calm. For most, it is the opposite. The post-close phase includes earnout management (if any), integration meetings, employment obligations to the new owner, and the strange feeling of having no daily company to run.

Plan the next chapter before the close, not after. What are you going to do for the first 90 days post-close? For the first year? Founders who go into the close with a plan for the next phase report a smoother transition than those who do not. Founders who close without a plan often spend the first six months in an uncomfortable identity reset.

Pay it forward

The single most consistent regret from founders who have been through a sell-side process is that they did not benefit from honest information when they started, and did not realize how easy it would have been to share what they learned afterward.

Once your process is done, please consider sharing what you learned. Add a review of your advisor on BankerNotes. Even a few sentences of honest feedback helps the next founder. The mistakes you made, the things you wish you had known, the questions you wish you had asked: that is the highest-value information any future founder can read. And it is information that almost nobody bothers to share, because by the time you are qualified to share it you have moved on.

This is the smallest possible thing you can do for the next founder. It takes ten minutes. Please do it.