Every business has skeletons in the closet. If diligence doesn't find any, we're not looking hard enough, or we don't know what to look for.
The skeleton itself is rarely the problem. Customer concentration. Deferred maintenance on the fleet. Messy books. If the deal makes sense, there are tools for all of it: price, structure, holdbacks, transition plans. We can build around a problem we can see.
What we can't build around is a surprise in month three.
I've sat across from three kinds of sellers. Some know the skeletons and put them on the table. Some honestly don't know, because nobody has ever looked at their business the way a buyer does. And some know and hope we miss it.
The first kind becomes a partner. The second we can work with. The third we walk away from, no matter how good the business looks.
Skeletons don't kill deals. Secrets do.
First published on LinkedIn.