A common starting point in conversations with business owners who are thinking about a sale is this: “Who’s going to buy our company?” It always comes up—and for good reason. It’s a natural curiosity and a foundational part of any exit discussion. But more often than not, it leads to an even more important mindset shift.
Many owners respond with a kind of wish list: “Maybe a leading company in our industry will want us,” or “Aren’t there firms out there that are buying up businesses like ours?” These ideas, while not entirely off-base, are usually based more on hope than strategic planning.
At Exit Pathways, our focus is helping business owners get clarity on their real options. And the truth is, there isn’t just one ideal buyer out there. There are, in fact, eight common exit pathways—four from within your company and four from the outside. The key to a successful exit is maintaining optionality and aligning with the option that best fits your goals.
Internal Buyers: The Often-Overlooked Path
1: Intergenerational Transfer
This is when ownership is passed to a family member, typically a child or close relative. It’s a meaningful choice, but one that requires clarity around capability and interest.
2: Management Buyout (MBO)
Your current leadership team already knows the business—and they may be interested in taking it over. This can create a smooth transition and preserve the company’s direction.
3: Partner Buyout
If the company has multiple owners or co-founders, selling your stake to your partners might be the simplest option. This is often guided by a buy-sell agreement already in place.
4: Employee Ownership (ESOP)
Selling to your employees through an Employee Stock Ownership Plan (ESOP) allows your team to take ownership of the business, promoting longevity and a strong internal culture.
External Buyers: The Broader Market
1: Third-Party Sale
This is a common route: selling to a larger company in your industry, a private equity firm, or a financial buyer. These buyers typically seek growth opportunities, synergies, or strong financial returns—and they know how to structure deals.
2: Recapitalization
A recap isn’t a full sale, but a partial exit. It involves bringing in a new investor to buy out some of the current owners while injecting fresh capital into the business. It’s a great way to de-risk while still participating in the future upside.
3: Orderly Liquidation
Sometimes the assets of the business hold more value than its ongoing operations. In these cases, a structured wind-down—selling assets and closing shop—can be a strategic and financially sound choice.
4: Initial Public Offering (IPO)
For a small number of businesses, going public is a viable path. But it’s important to be realistic—IPOs are costly, complex, and only suitable for companies with significant scale and growth potential.
The Takeaway
Too often, business owners focus on finding a “perfect” buyer—usually an aspirational name or a massive player in the industry. While those deals happen, they’re the exception, not the rule. The real opportunity lies in understanding the full range of viable exit pathways and positioning your business accordingly.
At Exit Pathways, we believe a successful exit starts with options. When you know your potential pathways, you can build toward the one that offers the best mix of value, fit, and future opportunity. That’s how you move from asking, “Who’s going to buy our company?” to confidently answering, “Here’s who should.”
Author: Brent Drever, Managing Partner
