Exit Readiness
and EBITDA Improvement

At 6x EBITDA, a $500K improvement in annualised EBITDA is worth $3M at exit. A $1M improvement is worth $6M.
Most owners understand the maths.

The question is whether the work gets done — with the rigour and accountability that converts intention into documented, defensible performance.

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What Exit Readiness Actually Involves

EBITDA Quality and Improvement

Buyers and their advisors will scrutinise EBITDA carefully. Addbacks need to be defensible. The run-rate needs to be clean and documented. And the trajectory needs to demonstrate improvement — not just a single good year. The work: implementing the pricing, margin and cost improvements that lift sustainable EBITDA.

Working Capital Normalisation

Working capital is a negotiation point in every transaction. Buyers will include it in the completion mechanism and benchmark it against what they consider normalised levels. Improving working capital management in the pre-exit period both releases cash and improves the transaction outcome.

Management Team and Operating Systems

Buyers acquire businesses, not individuals. A business dependent on the owner or a small number of key people is a riskier acquisition — and will be priced accordingly. Building management depth and operating systems that allow the business to run independently is exit preparation work that is consistently underinvested in.

Commercial Narrative

The investment thesis needs to be credible — supported by operational evidence. Pipeline, customer concentration, market position, product defensibility. Strengthening these factors is both operational and commercial preparation work.

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What This Usually Signals

When an owner or PE firm is thinking about exit but is not yet confident the business will hold up under scrutiny — EBITDA quality concerns, working capital questions, management dependency — that is exactly when structured pre-exit operational improvement needs to start.

When to Engage

• A transaction is being considered in the next 12–36 months
• EBITDA quality or trajectory is a concern for the board or investor
• Working capital or cash conversion is likely to be a negotiation point
• Management depth is insufficient for the business to run independently — a leadership intervention may be required before process begins
• The commercial narrative is not yet credible without the owner
• Previous exit attempts have not achieved the expected valuation

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When to Start

Earlier than owners and management teams typically think. The improvements that move EBITDA meaningfully — pricing architecture, working capital optimisation, cost rationalisation — take 6–18 months to implement and document. Starting 12 months before a process begins is too late to realise the full benefit.

The businesses that achieve the best exit outcomes typically begin structured pre-exit improvement work 18–36 months before they expect to transact. The ones that start 6 months out are managing the optics of a process, not the substance of performance improvement.

This is not transaction advisory work. It is embedded operational leadership — with P&L accountability and measurable outcomes.