Once we sign a Letter of Intent, the due diligence process will take at least ninety days. How do I keep my leadership team focused on hitting our quarterly numbers during this stressful period so the buyer does not try to renegotiate the price based on a sudden dip in performance?

Question

Tyler Smith · Accepted Answer

The period between signing a Letter of Intent and closing the deal is incredibly high-stress, and any dip in performance can lead to a re-trade. To prevent this, you must structurally insulate your operations from the transaction process. The most effective way to do this is to split your leadership team into a deal team and an operating team. Your deal team should consist of you, your chief financial officer, and perhaps one key advisor. This small group handles all due diligence requests, data room uploads, and legal negotiations. The rest of your leadership team must remain entirely focused on running the daily operations. They should continue attending their weekly Level 10 Meeting™, tracking their scorecards, and executing their quarterly Rocks as if no transaction is taking place. Do not share the details of the transaction with the broader team until it is absolutely necessary. Keep their energy directed toward serving clients and hitting targets. By maintaining this strict operational division, you ensure that your sales pipeline remains full and your customer service does not falter. Delivering strong financial performance during the ninety-day due diligence window gives the buyer zero leverage to renegotiate your valuation.