Fee conversations get avoided until late in the process far too often, and that is usually where trust breaks down. Here is the whole structure up front, before you have shared a single financial statement.
The short version: the seller pays, almost everything is earned at closing, and the first valuation conversation costs nothing.
The first conversation is free
An initial valuation discussion — reviewing your numbers, talking through a realistic range, and outlining what a sale process would look like — carries no fee and no obligation. Plenty of owners have that conversation two or three years before they actually sell, and that is a good use of it.
Sellers pay a success fee at closing
On a sell-side engagement, the bulk of our compensation is a success fee calculated as a percentage of the total transaction value and paid out of proceeds at closing. If the business does not sell, that fee is not owed.
Percentages scale with deal size: smaller main street transactions carry a higher percentage than lower middle market deals, and the exact rate, minimum fee, and engagement length are written into the engagement agreement before any work begins. No surprises, no fees discovered at the closing table.
- Success fee is a percentage of total transaction value, including any seller note or earnout
- Earned only when the deal closes
- Rate, minimum, and term are fixed in writing before the engagement starts
- Marketing and listing preparation are included, not billed separately
When there is a retainer
Some engagements — typically larger or more complex M&A work requiring extensive financial recasting, buyer research, or a managed outreach campaign — include a modest upfront or monthly retainer that covers that preparation work. Where a retainer applies, it is credited against the success fee at closing, so it is not an additional cost on a completed deal. Main street listings usually have no retainer at all.
Buyers do not pay us to look
If you are buying a business we have listed, there is no fee to view listings, sign a confidentiality agreement, receive the confidential information memorandum, tour the business, or work through diligence to closing. The seller's engagement covers the transaction on both sides.
The exception is a buy-side engagement, where a buyer hires us specifically to search for and approach businesses that are not on the market. That is a separate agreement with its own fee structure, agreed in advance.
Costs that are not ours
A transaction involves other professionals, and their fees are separate from the brokerage fee. Budget for them early so the net proceeds figure in your head is the real one.
- Your attorney for purchase agreement review and entity work
- Your CPA for tax structuring and allocation advice
- Lender fees on the buyer's side, including SBA guaranty and packaging fees
- Escrow, title, and lien search costs where real estate or secured assets are involved
- Any formal third-party appraisal, environmental study, or quality of earnings report a lender requires
Why it is structured this way
A success-based fee puts the advisor and the owner on the same side of the table. We are paid more when the business sells for more, and we are paid nothing if it does not sell — which means we will tell you honestly when a business is not ready, rather than taking a listing that will sit for a year.
If you want the specific numbers for your situation, ask on the first call. We will give them to you before you decide anything.