Checklist: Are You Ready for M&A?

Steve Simon
Jan 10
4 min read

Updated: Jan 17

TL;DR:

Selling your business is one of the most significant decisions you’ll make as a founder, and preparation is the key to success.
This checklist evaluates readiness across strategic, financial, operational, and emotional dimensions, helping you uncover areas of strength and opportunity.
DQM Advisory specializes in guiding founders through every stage of the M&A process, ensuring your goals remain at the forefront.

Selling your business is more than a transaction—it’s a major transition into the next chapter of your life and career. For most founders, it’s a first-time journey filled with complexities, unknowns, and high stakes.

At DQM, we understand that proper preparation is the difference between achieving your goals and facing avoidable challenges. Lack of readiness can lead to undervaluation, extended timelines, or even failed deals.

Use this comprehensive checklist to evaluate your M&A readiness across 10 key areas. Answer each question honestly to identify areas of strength and opportunity. Where gaps exist, DQM is here to provide tailored support and expertise to guide you confidently through the process.

1. Strategic and Personal Goals

☐ Have you clearly defined why you want to sell your business (e.g., financial independence, new ventures, retirement)?

☐ Are all key stakeholders (family, co-founders, board members) aligned on your decision to sell?

☐ Do you have a vision for what comes next after the sale, both personally and professionally?

☐ Have you considered how selling might impact your lifestyle, legacy, and sense of purpose?

DQM Helps By: Clarifying your goals, managing stakeholder alignment, and aligning the sale strategy with your long-term vision.

2. Financial Health and Valuation

☐ Are your financial statements (P&L, balance sheets, cash flow statements) up-to-date, accurate, and professionally audited/reviewed/managed?

☐ Do you understand how market trends and industry benchmarks influence your valuation?

☐ Have you identified your top value drivers (e.g., recurring revenue, customer retention, intellectual property)?

☐ Are you familiar with how buyers in your industry typically value businesses (multiples of EBITDA, revenue, or other metrics)?

☐ Have you considered the impact of working capital adjustments on your final sale price?

DQM Helps By: Conducting valuation analyses, identifying key drivers, and presenting your financial story compellingly to buyers.

3. Operational Readiness

☐ Can your business operate efficiently without you for extended periods?

☐ Have you identified and resolved inefficiencies that could detract from value?

☐ Are your systems (e.g., CRM, ERP, inventory management) scalable and integrated?

☐ Do you have reliable supplier and vendor agreements in place?

☐ Have you developed a contingency plan for operational risks during the sale process?

DQM Helps By: Conducting operational audits, optimizing systems, and preparing the business for a seamless transition.

4. Customer and Revenue Diversification

☐ Is your revenue diversified, with no single customer contributing more than 30%?

☐ Have you secured long-term contracts with your most valuable clients?

☐ Do you have a healthy pipeline of new business opportunities?

☐ Are your customer relationships well-documented and transferable?

DQM Helps By: Diversifying revenue streams, securing key agreements, and strengthening buyer confidence.

5. Market Timing and Industry Trends

☐ Are you aware of recent deals in your sector and their valuations?

☐ Do you understand how macroeconomic trends (e.g., interest rates, inflation) may affect buyer demand?

☐ Have you positioned your business to capitalize on favorable market conditions?

☐ Are you prepared to adjust your timeline if the market shifts unexpectedly?

DQM Helps By: Monitoring market trends, advising on timing, and ensuring you enter the process at the right moment.

6. Buyer Suitability

☐ Do you know which type of buyer (strategic, financial, private equity, individual) is best for your business?

☐ Have you evaluated how potential buyers align with your company’s culture, values, and vision?

☐ Do you understand how different buyers structure deals (e.g., cash upfront, earnouts, equity rollovers)?

☐ Are you prepared to engage with international buyers if they show interest?

DQM Helps By: Identifying and vetting buyers, negotiating terms, and ensuring cultural and strategic alignment.

7. Tax and Legal Preparedness

☐ Have you consulted with tax advisors to understand the implications of different deal structures?

☐ Are your corporate records, contracts, and intellectual property filings current and organized?

☐ Have you reviewed how the sale might affect personal or family tax liabilities?

☐ Are you prepared for buyer diligence requests that could span months?

DQM Helps By: Simplifying tax and legal complexities, coordinating with advisors, and preparing due diligence materials.

8. Team and Succession Planning

☐ Is your leadership team capable of running the business without your involvement?

☐ Have you developed retention strategies to secure loyalty from key employees during the transition?

☐ Do you have a succession plan that aligns with buyer expectations?

☐ Are your employees aware of and prepared for the potential sale?

DQM Helps By: Developing succession plans, fostering transparency, and ensuring employee retention strategies are in place.

9. Documentation and Due Diligence

☐ Have you organized all key documents (e.g., financials, customer contracts, operational procedures) in a secure data room?

☐ Are you ready to answer in-depth questions about your business during due diligence?

☐ Have you identified potential red flags that could arise during the buyer’s review?

☐ Are you prepared for multiple rounds of diligence from different buyers?

DQM Helps By: Preparing comprehensive due diligence materials and managing the process to minimize disruption.

10. Emotional Readiness

☐ Are you emotionally prepared to part with your business and move on to the next chapter?

☐ Do you have support systems in place to help manage the emotional highs and lows of the sale process?

☐ Are you ready to trust the buyer to carry your business forward in line with your legacy?

DQM Helps By: Offering mentorship, guidance, and emotional support throughout the sale process.

Scoring Your M&A Readiness: Key Area Readiness

8-10 Key Areas Ready: You’re in great shape but may need fine-tuning to optimize the process.
5-7 Key Areas Ready: You’re on the right path but would benefit from targeted guidance in specific areas.
0-4 Key Areas Ready: It’s time to partner with DQM to ensure your business is fully prepared for a successful sale.

Take the Next Step with DQM Advisory

Whether you’re fully prepared or just starting your journey, DQM is here to guide you through every step of the process.