Selling My Family’s Business Part 3: What I Would Do Differently

The one thing you don’t have in exit planning is a time machine. Nate O’Brien didn’t fully understand what that meant until he was living inside a transaction where every problem he was solving had a ten or twenty-year root system underneath it. 

When the transaction closed, every shareholder walked away with proceeds. Not all of them had earned it. Part 3 of this three-part series examines what the final outcome looked like for each member of the ownership group, a working capital true-up that arrived months after closing, and the lessons Nate carries into every exit planning conversation today, including the one no governance document or advisory team can fully substitute for. 

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How the proceeds were distributed among shareholders

My uncle, who had caused significant business and personal pain through his involvement with the company, had been largely absent from the business for two decades, and whose unresolved ownership had been a source of friction from the moment we began the process, closed at 10% based on pricing from the early 2000s. In practice, that meant purchasing the remaining 8% at a price set 20 years earlier, then immediately realizing the full benefit of that stake at a 6.5x multiple on a business worth multiples of what it had been when that price was originally agreed to. He walked away with his share of the proceeds and left the business on closing day as agreed. 

My aunt, who had embezzled from the company, spent a decade threatening litigation, refused every buyout offer, and sent a demand letter the night before closing, received the largest share of the operating business proceeds among the minority shareholders. 

My parents and uncle, who had built and run the business for the last 18 years, reinvested rather than taking distributions, and navigated every obstacle with integrity, closed at 6.5x normalized EBITDA (earnings before interest, taxes, depreciation, and amortization), less concessions. I will not pretend my uncle was a model business partner in every respect. He had his own shortcomings, and the people who worked alongside him over the years would have plenty to say about his communication style and his treatment of employees. But in the context of this ownership group, he looks like a textbook co-owner. He showed up, he didn’t steal, and he left cleanly on exit day without making a single demand. Sometimes that’s what the bar looks like, and he cleared it. 

My father and uncle owned the real estate 50/50 through a separate entity, and that component sold separately from the operating business, yielding proceeds representing roughly 30% of the total transaction value. My aunt and the 10% uncle had no claim to it. That was not an accident. My grandfather had changed his will to leave the real estate exclusively to my father and uncle. He never directly confronted the damage the other two siblings had caused during his lifetime, and in many ways, he tried to keep the peace even when it wasn’t deserved. But I think he knew. The will was his quiet acknowledgment of who had actually shown up, who had kept the business alive, and who deserved to benefit from what it became. It was perhaps the most honest thing he ever said on the subject, and he said it without saying a word. 

What happened when family dynamics met the closing table

When my aunt learned about the real estate at the will reading, the ire that followed never really subsided. I believe that exclusion—justified as it was—became the lens through which she viewed every subsequent interaction with the business, and ultimately the fuel behind the demand letter that arrived the night before closing. 

My father signed a two-year employment agreement with the acquiring company on generous terms, a recognition from the buyer that his knowledge, relationships, and institutional memory were worth retaining through the transition. It was a meaningful validation after everything the process had put him through. Just last week, he was appointed to the board of directors of the acquiring company. My mother is still serving as office manager under the new ownership, winding down her role and training my sister, who has worked in the front office for about four years now, to carry it forward. In a way, the next generation did show up after all—just not in the form anyone originally anticipated. 

Was it fair? Not entirely. The people who fought hardest for their slice contributed the least to building it. But my parents are financially secure for retirement. The business they built will continue under ownership that respects what they created. My father now sits on the board of the company that carries his family’s legacy forward. And the deal closed. 

The working capital true-up

Several months later, we completed the 90-day working capital true-up that is standard in most purchase agreements. In the heat of diligence, with countless requests flying in every direction, an accounts payable balance was submitted that understated the true liability at closing. The result was approximately $150,000 owed back to the buyer. These things happen in complex transactions, and diligence is an overwhelming process for any closely held business navigating it for the first time. 

What struck me was not the adjustment itself but who showed up to deal with it. My aunt and uncle, who had each fought aggressively to protect and maximize their proceeds at closing, were notably absent. The shareholders who had built the business and absorbed the cost of resolving every dispute along the way were also the ones who showed up when something went the other way. 

It’s a fitting reminder that ownership carries obligations, not just benefits—and that the shareholders who are most vocal about their rights are not always the ones who accept the responsibilities that come with them. 

What I would do differently in exit planning for a family business

I am a valuation and exit planning professional. I had more context going into this process than most families do, and there are still things I would change. 

The ownership documentation should have been cleaned up years before we considered a transaction. The informal arrangements, the undocumented repurchase agreements, the shareholder meeting minutes that key owners never signed—all of it created friction that cost real money and real time at the worst possible moment. When I work with family business owners today, a documentation review is one of the first things we do. Not because a transaction is imminent, but because the time to find these issues is when there is no buyer waiting on the other side. 

The minority shareholder situation should have been addressed earlier and more aggressively. Every offer to buy out my aunt was reasonable. The failure to close one of those transactions over a decade is a compounding problem, and the leverage it ultimately created at the closing table was entirely predictable in retrospect. Misaligned shareholders don’t become more reasonable as a transaction approaches. They become more powerful. The window to resolve those situations on favorable terms closes long before a deal is on the table. 

The advisory team should have been assembled earlier. The wealth manager, the mergers and acquisitions (M&A) advisor, the attorney—these are not relationships you build during a transaction. They’re relationships you build years before one. The owners I work with who have the best outcomes are almost always the ones who started those conversations long before they needed them. 

But perhaps the deepest lesson is one that no governance document or advisory team can fully substitute for. My grandfather was a builder. He built a business, he built a family, and for decades, he tried to hold both together by absorbing tension rather than addressing it. The embezzlement, the unresolved ownership, the relationships that had frayed beyond repair—he compartmentalized all of it, keeping the peace in the room while the pressure built behind the walls. By the time the business was ready to sell, decades of unaddressed conflict had nowhere to go except directly into the transaction. And that’s exactly where it went. 

Family businesses are pressure cookers. The disputes don’t disappear because no one names them. They accumulate. And they tend to surface at the worst possible moment—when a deal is on the table, a deadline is looming, and the cost of conflict is at its highest. The most valuable thing a family business owner can do is not wait for that moment to have the hard conversations. Have them early, have them directly, and if you can’t have them alone, bring someone in to help. The alternative is a closing-eve demand letter and a phone call no one wants to receive. 

The one thing you don’t have in exit planning is a time machine. If we had one, some of this would have gone differently. Since we don’t, the only real alternative is to start earlier than feels necessary, document more carefully than feels required, and have the difficult conversations before the stakes make them nearly impossible. 

According to the Exit Planning Institute, only 20% to 30% of businesses that go to market actually sell. My family’s business was one of them. Not because everything went smoothly, but because the preparation, the advisory team, and the years of operational improvement created a business that the market wanted. The hard moments along the way were survivable because the foundation was strong enough to absorb them. That’s what good exit planning does. It doesn’t eliminate the unexpected. It gives you enough runway to get through it. 

If your family business has unresolved ownership issues, informal arrangements, or shareholders whose interests are misaligned with the business’s future, the time to address them is now—not when a buyer is at the table.