Earn-outs in Business Sales
When buyer and seller disagree on business value, an earn-out bridges the gap. This guide explains the mechanics of variable purchase price components — from the metrics that govern your payout to the clauses that protect it.
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Table of contents
Chapter 1
Basics & Structure
How a split purchase price bridges the valuation gap — and the three components that decide how much of the deferred money ever reaches your account.
Chapter 2
Metrics, Clauses & Calculations
The metric that governs your payout, the six clauses that stop the buyer quietly reducing it, and two worked calculations that show the difference in hard numbers.
Chapter 3
Risks, Negotiation & Conclusion
The four risks that turn earn-outs into broken promises, six moves to protect yourself, and a clear test for when an earn-out actually works in your favour.
Here's what founders and advisors say
Sophie van der Berg
CEO @ VDP
“I read this before our first advisor meeting, and it completely changed how we approached the deal structure.”
About the author
Felix Buschkotte
Advisor @ Grunwald
An IT entrepreneur for over seven years with a successful exit. He has guided the sale of his own family business as well as numerous private-equity acquisitions as an advisor.
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