Exit Mode Insider · Bonus
The 7 Questions Every Buyer Asks (And Most Founders Fumble)
A short, tactical guide for founders heading towards exit. ~12 min read.
Why these seven?
I've sat through more first buyer meetings than I can count — as the founder being bought, as an adviser sitting next to founders being bought, and as a buyer on the other side of the table.
Every single one of them circles the same questions.
They rarely feel like the most important ones when you're running the business day to day. But in a sale process, these seven are the ones that push your multiple up or down by a full turn of EBITDA. Sometimes two.
Most founders don't fumble them because they don't know their business. They fumble because they've never been asked these questions out loud by someone who's decided whether to write a seven-figure cheque based on the answer.
So here they are. With what the buyer actually wants to hear, and what to stop saying when you answer.
1. "What happens to the business if you got hit by a bus tomorrow?"
What they're really asking
How much of the enterprise value walks out of the door with you?
The fumble
Most founders answer this one by listing everything they personally do. “Well, I handle the top 10 client relationships, I lead strategy, I'm in every product decision, I do the hiring for senior roles…”
That answer has just shaved a turn off your multiple.
What to say instead
“The top 10 client relationships sit with [named person]. I'm still introduced on new accounts for continuity, but renewal and expansion conversations run without me. On product, the weekly roadmap decisions run through [name and title]. On senior hires, I'm the final sign-off but not the sourcing channel.”
Write that answer out now. If you can't, you've found your pre-sale work.
2. "Tell me about your three biggest customer losses in the last 24 months. What happened?"
What they're really asking
Are you self-aware about churn risk? Can you tell the truth when the answer isn't flattering?
The fumble
“We haven't had any significant losses” — even when you have. Or: reaching for the same stock story (“they got acquired”) for every single loss.
Buyers have already run a concentration analysis on your customer list before the meeting. If a name they expected to see is missing, they know. Pretending otherwise signals you'll also paper over the next problem.
What to say instead
Name the three losses by business (no names needed under NDA, but sector and size). For each, answer three things:
- Why did we lose them (honestly)
- What we changed as a result
- How we'd see it coming earlier now
The third one is the prize. It's you demonstrating you've built a system, not a vibe.
3. "How much of next year's revenue is already contracted?"
What they're really asking
How much of what you're selling me is forecast vs. signed?
The fumble
Giving them a forecast number dressed up as a contracted number. Or: not knowing the answer off the top of your head.
What to say instead
“Of our £[X] forecast for next year, £[Y] is contracted and billing today. £[Z] is contracted but not yet live. Of the remaining, £[A] is in commercial negotiation with signed LOIs, and £[B] is pipeline at [stage]. Our contracted revenue alone covers [N]% of our committed cost base next year.”
If you can't say this without looking at a spreadsheet, build that spreadsheet this week. Buyers want to see that YOU know the number without checking.
4. "Walk me through your gross margin by customer cohort."
What they're really asking
Are your best customers actually your best customers?
The fumble
Answering with a blended gross margin. “We're at 68% blended.” Buyers don't buy blended margins. They buy the margin trajectory of the customer types they want to keep, scale and sell more to.
What to say instead
Break your customer base into 3-5 cohorts based on how they came in (channel), what they buy (product line), or what size they are. For each cohort:
- Gross margin
- Net revenue retention
- Direction of travel over the last 12 months
If one cohort is way more profitable than another, that's not a weakness. That's the insight buyers use to justify paying more — because they know where to double down post-acquisition. Your answer just wrote part of their investment committee memo for them.
5. "What's your single biggest operational risk right now?"
What they're really asking
Are you the kind of founder who downplays risk, or the kind who's already working on it?
The fumble
“Honestly, things are in great shape, no major risks come to mind.”
Every buyer has walked in already suspecting what your risk is. They've read your website, your contracts, your accounts. They know a big chunk of your revenue comes from one channel, or one integration partner, or one piece of IP.
If you don't name it, they will. And they'll name it with a discount attached.
What to say instead
Pick the most obvious risk, name it plainly, then give them the mitigation plan. “Our single biggest operational risk today is [X]. We've been addressing it by [Y], and the leading indicator we watch is [Z]. If [Z] trips, here's what we do next.”
You're not telling them something they don't already know. You're showing them you know it too, and you're already working on it. That's a premium answer.
6. "If I handed you £2 million tomorrow to invest in the business, where would it go?"
What they're really asking
Do you have a thought-through next-chapter for this business, or will I need to write one for you?
The fumble
A shopping list. “We'd hire another BDR, invest in marketing, maybe open a US office, upgrade the tech stack…”
That answer tells them you haven't decided what matters most — which means post-acquisition, they'll have to.
What to say instead
One concentrated bet, defended with numbers. “The highest-leverage thing we could do with £2m is [specific initiative]. Here's why: [current constraint]. Here's the math: [inputs → outputs]. Here's the milestone we'd hit by [month N].”
You want to leave them thinking “this founder would be a good operator under us.” Even if the deal structure means you're not staying, that answer is worth money on the multiple.
7. "Why are you selling now?"
What they're really asking
Is this a distressed sale or a strategic one? And is the founder going to blow up the transaction on day 30 because they're not emotionally ready?
The fumble
Version 1: “We feel we've taken it as far as we can on our own.” Buyers hear: the founder is exhausted and the business might be too.
Version 2: “The timing's good for me personally.” Buyers hear: the founder is looking after themselves, not the business. Expect a low-trust process.
Version 3: “We're not really selling, we're just open to the right partner.” This is the worst one. Buyers hear: the founder is going to flake. They will.
What to say instead
A three-part answer.
- Why this business is worth more in the hands of a buyer like them than in yours today (a capability, a distribution channel, a capital base)
- What you still want to be part of after a sale (often: the growth phase, for 12-24 months)
- What the business needs from the next chapter that you can't personally give it
That answer shows you've thought about fit, not just exit. Buyers back it. Prices move.
What to do with this
Don't wait until a buyer is sitting across from you to test your answers.
This week, block a 90-minute session. Answer all seven questions out loud, into a voice recorder. Play it back. Anywhere you waffled, moved on, or said “honestly” more than once — that's a question you haven't built the answer to yet.
These seven aren't the whole sale process. They're just the seven where founders most consistently leak value.
Get them tight, and you walk into every buyer meeting worth more than you did yesterday.
— Adam