tyler-smith.com · Questions & Answers

We want to secure our key employees through a future sale so the buyer does not worry about team flight risk, but we cannot afford to tank our EBITDA with massive cash retention bonuses. How do we align our team for a clean exit?

Key employee flight risk is a major concern for buyers, but you do not need to destroy your EBITDA with massive cash retention bonuses to solve it. Instead, focus on building a strong, open culture and providing long-term career clarity.

Use the EOS framework to align your leadership team. When your managers understand the V/TO and see a clear three-year picture, they feel secure about the company's trajectory. Ensure that every key manager clearly understands how their role can expand post-sale. Buyers often bring resources that unlock new growth opportunities, which is highly attractive to ambitious leaders.

Additionally, you can implement non-cash retention strategies, such as structured performance milestones or clear career pathing. By showing your team that a sale is a vehicle for growth rather than a threat, you maintain operational momentum. A highly aligned, stable leadership team that is excited about the future is one of the most valuable assets a buyer will pay for.

Category: Exit Planning

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