Three steps to enhance bankability of your buyer


To become bankable and secure financing for buying a business, it’s crucial for the seller to introduce the management team to the banker. This allows the banker to evaluate their abilities and assess their potential to run the business without the owner. Transferring significant roles to the team ensures a smoother transition for new owners and instills confidence in their ability to succeed, which is important when financing the purchase of an existing business.

To create resources for buyers, incentive compensation such as phantom stock or deferred bonuses can be used to make a meaningful down payment that will help secure commercial financing. This approach allows the buyer to invest in the business while demonstrating their commitment to its success, making them a more attractive candidate for financing. By utilizing this strategy, the seller can improve the chances of securing financing and help the buyer become bankable, ultimately leading to a smoother acquisition process for all parties involved.


Hi, this is Byron. I’m speaking to you

today from the banks of the Fremont

river, which flows through Capitol Reef

National Park in Central Utah.

I wanted to share with you today my

thoughts on how to make your buyer more


And it’s three steps:

delegation, incorporating the lender


and selling ownership. Under the

delegation – when you’re thinking about

transferring control of your company, you

need to get your buyers in a position

where they can run the day-to-day. And we

ultimately need them to prove to the

lender which is step two that they’re

capable of running the business day to

day even in difficult times. So the

longer they’re in the seat, the more

compelling of a story you can make for

the banker why they’re bankable.

And then third

is to sell some ownership early, so

they’re building up collateral. So, three

steps: delegate and elevate, involve your

lender early, and sell ownership to bill


Don’t miss the opportunity of your lifetime.

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