Most Businesses Don't Sell. That Doesn't Mean You Failed.

Business owners hear a lot about exits. Build something valuable. Grow it. Find a buyer. Sell. Walk away with a check.

That is one version of an exit.

It is not the version most business owners experience.

The Exit Planning Institute reports that only about 20% to 30% of businesses that actually go to market ultimately sell.

And a 2026 report from McKinsey found something even more striking. Looking at small and midsize businesses that exited the market in 2022, McKinsey estimated that 92% closed, while 5% were sold and another 3% transferred to new owners through other means.

Those numbers measure different things, so they should not be compared directly. But they point to the same reality:

A traditional sale is not how every business ends. Not even close.

Closing is not the opposite of a successful exit

There are plenty of reasons a good business may not sell.

The company may depend heavily on its owner.

It may be profitable, but too small to attract enough qualified buyers.

The owner may need to leave faster than a sale process allows, often due to unexpected life disruptions.

The business may have valuable equipment, intellectual property, customers, contracts, or other assets, but not enough of a transferable operating company to make a traditional acquisition work.

Sometimes the business has simply done what it was supposed to do.

It supported a family. Created jobs. Served customers. Paid a mortgage. Put kids through school. Gave someone independence. Lasted 10, 20, or 30 years.

There is no rule that says the only way for that story to end well is for somebody else to buy it.

There may be more than two choices

Owners often come into an exit conversation believing they have two options:

Sell the business.

Or:

Shut it down.

There is usually more territory between those two.

Depending on the business and what the owner wants, the options might include:

• Selling the operating business to an outside buyer

• Transferring it to an employee, partner, manager, or family member

• Finding a strategic buyer for the technology, brand, customers, team, or intellectual property

• Selling a product line or selected assets

• Selling operational data.

• Licensing intellectual property

• Creating a transition that involves little or no cash at closing

• Stepping back while someone else takes over day-to-day operations

• Stabilizing the company before deciding

• Winding down deliberately and selling what still has value

The best path is not always the one with the biggest transaction attached to it.

It is the one that fits the owner, the business, and the reality of the situation.

Some businesses that close could have transferred

There is another part of this story that deserves attention.

McKinsey estimates that about six million U.S. small and midsize businesses will face ownership transitions by 2035 as baby boomers retire. The firm estimates that more than one million of them could be viable candidates for a sale or employee-ownership transition.

McKinsey also found that smaller companies face particularly difficult odds. Businesses valued below $2 million make up a large share of expected transitions but often have less access to buyers, financing, and professional transaction support. That is where business advisory services, like Exit with Mo, can step in and help close the gap. 

Some businesses will close because closing genuinely is the right answer.

Others may close because the owner did not seek out or engage proper advisory support, started the process too late, did not know how to value the business for current market conditions, could not find the right buyer, or never realized another kind of transfer was possible.

Start before you need the answer

If you think you may want to sell or close your business in 2027, you do not need to decide today which one it will be.

But this is a very good time to understand your options.

Start with questions like:

• What might my business realistically be worth?

• Could someone else operate it without me?

• What would a buyer actually be buying?

• Are there employees or family members who might want to take it over?

• Does the company have strategic value beyond its profits?

• Are there assets worth selling separately?

• What do I personally need financially from an exit?

• How much longer do I actually want to do this?

You may discover that preparing for a sale makes sense.

You may discover that the business needs another year of work first.

You may decide to transfer it internally or pass it along to your employees through an ESOP (Employee Stock Ownership Plan).

Or you may conclude that the smartest, healthiest, and most financially responsible thing to do is close it well.

All of those can be legitimate outcomes. Speaking to an advisor who has experience in the process can help you get a better sense of the logistics so you can help make a proper decision for your business. 

The goal is not to force a sale

I work in M&A. I help business owners sell companies through my practice with Lion Business Advisors. I also help business owners with everything in between through my work with Exit with Mo. 

I have also been the founder on the other side of this decision, and I have closed a business and sold a business so I can speak to both the emotional and transactional elements of each process.

I do not believe every business should be sold. But I do believe that options should be evaluated thoroughly before decisions to close are made. 

Sometimes the most valuable part of an exit conversation is discovering that a sale is realistic. Sometimes it is discovering that it is not. And sometimes it is realizing there is another path you had not considered yet.

A business does not have to end in an acquisition for the years you spent building it to have mattered. It also does not have to end in an acquisition to close out in a financially positive position.

Thinking about selling or closing your business in 2027? Let’s talk.

Book a free 20-minute call with Mo →

Written by Maureen Brown, M&A Advisor with Lion Business Advisors and co-founder of Mosie Baby. Maureen helps business owners think through selling, closing, transferring, or stepping away from their companies. She is a member of IBBA and TABB and is based in Austin, Texas.

Sources

1. Exit Planning Institute. “State of Owner Readiness.” Accessed October 2026.
   Exit Planning Institute: Exit Planning Institute — State of Owner Readiness

2. McKinsey & Company. “The Great Ownership Transfer: A New Era of Business Stewardship.” February 26, 2026.
   McKinsey & Company: McKinsey — The Great Ownership Transfer