Mark Hartmann on the M&A Launchpad Podcast: The $1 Million Mistake That Changed How I Advise Sellers
- Mark Hartmann, MBA
- Aug 7
- 5 min read
Some business lessons are expensive.
Others may cost you $1 million.
Years ago, I sold my own company for eight figures without hiring a business broker or M&A advisor. It was a successful exit, but it was not a perfect one.
At the time, I did not fully understand how working capital would be treated in the transaction. I believe the way that issue was handled may have reduced my proceeds by roughly $1 million.
That lesson changed the direction of my professional life.
I recently joined Casey Minshew and Feras Moussa on the M&A Launchpad Podcast to discuss that experience, what I learned from selling my own company, and how those lessons influence the way I advise business owners today.
We also discussed exit preparation, deal terms, Letters of Intent, the emotional side of selling a company, and why owners need to assemble the right transaction team before going to market.
You can watch our conversation on YouTube here.
Here are three of the biggest takeaways for business owners:
1. The Headline Price Is Not the Deal
Owners naturally focus on the purchase price.
But the number at the top of an offer is not necessarily the amount the seller receives—or keeps.
Working-capital adjustments, debt, indemnification escrows, earnouts, seller financing, purchase-price allocations, transition requirements, and other deal terms can materially affect the economics of a transaction.
My own experience with working capital is a painful example.
I had spent years building a valuable company. I understood my customers, employees, operations, and financial performance. But I had never sold a business before, and I did not understand every component of the transaction as well as the professionals sitting across the table.
That knowledge gap was expensive.
This is also why the Letter of Intent matters. Sellers often assume the difficult negotiation will occur during the purchase agreement. In reality, the seller usually has the most leverage before granting a buyer exclusivity.
The major commercial terms should be understood as clearly as possible before the LOI is signed.
A higher offer with unfavorable terms may be worth less than a slightly lower offer with more cash at closing, fewer contingencies, and greater certainty.
The purchase price gets the attention. The deal structure determines the outcome.
2. Exit Preparation Should Begin Before You Are Ready to Sell
One of the most important changes in my own journey occurred when I stopped looking at my company exclusively through the eyes of an operator and began looking at it through the eyes of a buyer.
Those are two very different perspectives.
An owner may see a profitable company with loyal employees, long-standing customers, and decades of operating history.
A buyer also sees risk.
The buyer will want to know:
How dependent is the company on the owner?
Are the financial records accurate and defensible?
Are customer relationships transferable?
Is revenue concentrated among a small number of accounts?
Are operating processes documented?
Is there a capable management team?
Can the company continue performing after the owner leaves?
These issues cannot always be repaired during a rushed sale process.
Reducing owner dependency, developing management, cleaning up the financials, documenting systems, and diversifying revenue may require several years. That work can improve not only the valuation, but also the terms a buyer is willing to offer and the probability that the transaction will close.
The best time to begin preparing for a sale is usually before you believe you need to.
3. The Seller Should Run the Company—While the Advisor Runs the Deal
Getting an acceptable offer is not the end of the transaction.
It is the beginning of a demanding process involving due diligence, legal documentation, financing, financial analysis, negotiations, scheduling, information requests, and a steady stream of decisions.
There is also an emotional component.
Owners are selling something they may have spent most of their adult lives building. Buyers are committing significant capital and looking carefully for risk. Attorneys, accountants, lenders, investors, and other professionals enter the process with their own responsibilities and priorities.
Someone needs to coordinate the transaction, manage expectations, maintain momentum, and keep small disagreements from becoming deal-ending problems.
I describe the advisor’s role as being the concierge—or quarterback—for the transaction.
My job is to run the deal. The owner’s job is to run the company.
That division of responsibility matters. If the owner becomes consumed by the sale process and the company’s performance declines, the buyer may attempt to reduce the price, change the terms, or walk away.
A qualified advisor should allow the owner to remain focused on customers, employees, revenue, and profitability while the transaction moves toward closing.
You May Only Get One Opportunity
Near the end of the conversation, I offered three pieces of advice to anyone considering buying or selling a business:
Ignore the head trash. Start earlier than you think you need to. Build the best team you can.
For most business owners, selling a company is not a skill they will have the opportunity to develop through repetition. They may only do it once.
That is why preparation, representation, and deal structure matter so much.
Thanks to Casey Minshew, Feras Moussa, and the M&A Launchpad Podcast for the conversation.
At HartmannRhodes, we help owners understand what their businesses are worth, identify issues that may reduce value, prepare for the market, and navigate the transaction from initial planning through closing.
HartmannRhodes advises owners of companies typically valued between $1 million and $25 million. If you are considering selling within the next few years, we can provide a structured pre-sale valuation review and readiness roadmap based on your company, timeline, and goals.
You only sell your business once. Make it count.
Mark Hartmann is a former business owner turned M&A advisor—and the author of Sweat Equity Payday—who knows firsthand what it takes to build, grow, and sell a successful company. A three-time Inc. 5000 CEO honoree, he led his own eight-figure sale and now helps business owners sell companies worth $1M to $25M. Mark understands that selling a business is personal, not just financial. That’s why he works closely with owners to maximize value, protect their legacy, and transition on their terms.
He holds an MBA from Eastern University and a master's degree in organizational change management from St. Elizabeth University, as well as Certified M&A Professional (CM&AP), Certified Business Intermediary (CBI), Certified Exit Planning Advisor (CEPA), and Certified Value Builder (CVB) credentials.
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HartmannRhodes advises owners of companies typically valued between $1–$25 million. If you’d like a structured pre-sale valuation review and a readiness roadmap, we can walk you through the process and tailor it to your timeline and goals. Contact us today!
Blog: Mark Hartmann on the M&A Launchpad Podcast: The $1 Million Mistake That Changed How I Advise Sellers