Preparing for a Successful Business Exit: The Three Legs of the Stool

Exiting a business is one of the most significant decisions a business owner will ever make. For many, their business is not only their largest financial asset but also a major source of identity and purpose. The Exit Planning Institute (EPI) often refers to the “three legs of the stool” framework—personal readiness, financial readiness, and business readiness—as the foundation for a successful transition. Like a stool, if one leg is missing or unstable, the entire plan is at risk.

At Mission Wealth, we work with business owners to bring balance to all three legs, ensuring they can exit on their terms, with clarity and confidence.

Read about the “three legs of the stool” framework below, with tips on how you can align your mindset and financials for your next stage of life.

1. Personal Readiness: Defining Life After Business

Too often, business owners prepare their businesses for sale but neglect to prepare themselves. After years of pouring their time, energy, and identity into building an enterprise, many owners find themselves asking: “Who am I without my business?”

Questions to consider:

• What does a fulfilling “next chapter” look like for you? (Check out our Inspired Living™ service!)
• How will you spend your time when the daily demands of running a business are gone?
• Is your family aligned with your vision for life post-exit?

Why it matters: Without a clear sense of purpose beyond the business, owners may feel a void after the transition. By exploring passions, hobbies, philanthropy, or even mentoring other entrepreneurs, you create a meaningful roadmap for your future.

2. Financial Readiness: Ensuring Your Wealth Supports Your Lifestyle

An exit is not just about the sale price; it’s about what you keep after taxes and whether those proceeds sustain your goals for decades to come. Many owners have the majority of their wealth tied up in their business, which makes proper planning essential.

Questions to consider:

• How much do you need from a sale—after taxes—to maintain your desired lifestyle?
• Have you diversified your wealth outside the business?
• Have you run stress tests against different scenarios, such as market downturns or rising healthcare costs?

Why it matters: A strong financial plan helps you understand whether an exit today would support your long-term needs—or if you should build additional value first. Effective tax planning, strategic charitable giving, and structuring transactions appropriately can significantly enhance your outcomes.

3. Business Readiness: Building a Company That Can Thrive Without You

Buyers want a business that is transferable, sustainable, and valuable—without being dependent on the current owner. Strengthening business readiness not only improves valuation but also expands the pool of potential successors, whether from within the family, management, or a third party.

Questions to consider:

• Can the business operate smoothly without your daily involvement?
• Do you have strong management, governance, and incentive systems in place?
• When was the last time you had a professional business valuation?

Why it matters: A business with well-documented processes, strong leadership, and stable revenue streams is far more attractive to buyers and better positioned for long-term success.

Pulling It All Together

When all three legs of the stool are strong—personal, financial, and business readiness—business owners are positioned to exit on their terms. The result is not just a liquidity event, but a successful transition that preserves your legacy, secures your lifestyle, and rewards the years of effort you put into building your company.

At Mission Wealth, we guide business owners through each stage of exit planning with an integrated approach. By combining financial expertise, tax strategy, and personal guidance, we help you navigate the complexities of succession with clarity and confidence.

If you’re a business owner contemplating your exit, let’s start the conversation. Together, we can create a plan that supports both your financial well-being and your vision for the future.