Our leadership team is divided on the deal structure, with our visionary founder eager to accept a high-equity roll-over while our execution-focused integrator is highly skeptical of the buyer's long-term stock value. How do we resolve this internal friction before we sign the letter of intent?

Question

Tyler Smith · Accepted Answer

Internal alignment is critical before you sign a letter of intent. If your visionary founder and execution-focused integrator are misaligned on the deal structure, the buyer will sense this weakness and use it to their advantage during negotiations. To resolve this friction, bring your leadership team back to your EOS V/TO. Use your long term vision and core values to evaluate the transaction. The founder is likely focused on the upside of a high equity roll over, while the integrator is focused on the downside risk of holding illiquid stock in an entity they no longer control. Acknowledge both perspectives as valuable. Use your weekly leadership meetings to IDS this issue. Break the tension by structuring a compromise in your target deal terms. For example, you can negotiate for a lower percentage of roll over equity in exchange for a higher cash payout at close, or request a class of preferred stock that carries liquidation preferences and dividend rights to protect the integrator's downside. By aligning your team around a single, agreed upon deal structure on your V/TO, you present a united front to the buyer, protect your enterprise value, and ensure a clean, successful exit.