The Exit Readiness Index

What this report finds

Founders assume that a strong business will sell well. It will not, unless it is also ready to be sold. Readiness is a separate axis from quality, and the gap between a ready and an unready version of the same company shows up in both the price achieved and the odds of closing at all.

Readiness is not a measure of how good a company is. It is a measure of how cleanly it can be examined, transferred, and closed, judged by the standard of the buyer who will diligence it. Understanding the difference is the foundation of the Index.

The Index scores readiness across the seven dimensions a buyer examines. Each dimension can be strong or weak independently, and a company’s overall readiness is only as good as its weakest, because a single unready dimension can stall or kill a deal.

Each dimension of readiness has a small number of things that make a company ready or unready in a buyer’s eyes. The detail below is where a founder should focus the assessment and the work.

Readiness pays in two currencies: a higher price and a higher probability of closing. Both are large, and together they make readiness the most valuable pre-sale investment a founder can make.

The readiness premium is clearest when the same company is taken to market in two states. The contrast below holds the business constant and varies only its preparation, and the difference in outcome is the premium made concrete.

Windsor Drake’s research desk compiled this report from transaction data, public filings, and the firm’s sell-side advisory work in software, fintech, AI, and cybersecurity. It is intended to inform founders, owners, and acquirers evaluating a transaction, and does not constitute investment advice.