# EXIT Framework: The 40-Point Business Exit Readiness Assessment
Most business owners get one chance to sell their company. The EXIT Framework, developed by Scott Sylvan Bell, is a 40-point assessment that reveals whether you’re truly ready—or just thinking about it. In 15 minutes, owners of $10M-$250M companies discover exactly where they stand across the four dimensions that determine exit success.
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## What is the EXIT Framework?
The EXIT Framework is a 40-point self-assessment that evaluates four critical dimensions of successful business transitions. Scott Sylvan Bell created EXIT specifically for business owners considering a sale within 1-5 years who want to maximize value and avoid common exit failures.
EXIT stands for:
– **E** – Evaluate Readiness
– **X** – maXimize Value
– **I** – Ideal Buyer
– **T** – Transition Strategy
Each dimension contains 10 questions worth 1 point each. Your total score reveals your exit readiness and the preparation work required before going to market.
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## Why do most business exits fail?
Most business exits fail because owners approach this once-in-a-lifetime transaction with less preparation than buying a house. Scott Sylvan Bell identifies four common failure modes in his work with $10M-$250M companies:
**Selling too early:** The owner gets an unsolicited offer, excitement overrides strategy, and the company sells for $15 million when waiting 18 months might have yielded $25 million.
**Selling too late:** The owner plans to “sell in a few years” for a decade. By the time they’re ready, growth has stalled and they’re selling into weakness.
**Wrong buyer:** A strategic acquirer offers a premium with an earnout that traps the owner for five years. A different buyer would have paid slightly less with a clean break.
**No transition plan:** The owner collects the check and experiences an identity crisis. The business was their purpose—now what?
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## What does the E in EXIT stand for?
The E in EXIT stands for Evaluate Readiness. This dimension assesses whether you are personally, financially, and emotionally prepared to sell—and whether the business is at the right point in its trajectory.
Readiness requires alignment across three areas:
**Personal Readiness:** Do you have a clear vision of life after selling? Have you discussed plans with family? Are you emotionally ready to let go?
**Financial Readiness:** Have you calculated your “number”—the after-tax proceeds needed? Does the realistic sale price meet your needs?
**Business Timing:** Is the business currently growing? Are you selling into strength or weakness?
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## How do I know if I’m personally ready to sell my business?
You’re personally ready to sell when you can answer yes to four questions: You have a clear vision of post-exit life. You’ve discussed plans with your spouse or partner. You have meaningful activities outside the business. You’re emotionally prepared to see someone else run your company.
Scott Sylvan Bell emphasizes that selling without personal readiness leads to regret regardless of purchase price. The business has been your primary identity for years—removing that without a plan creates a void money cannot fill.
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## What does the X in EXIT stand for?
The X in EXIT stands for maXimize Value. This dimension evaluates whether you’ve optimized the factors that drive premium valuation multiples before going to market.
Value maximization happens 12-36 months before sale, not during negotiations. By the time you’re in a deal process, your multiple is largely determined. The preparation phase is where enterprise value is won or lost.
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## What do buyers pay premium multiples for?
Buyers pay premium multiples for six characteristics that reduce their risk and increase their return:
**Recurring revenue:** Contracted, predictable income streams command higher multiples than project-based work.
**Revenue growth:** Demonstrated momentum matters more than current size. Growing 20% annually beats flat at higher revenue.
**Margin expansion:** Growing profitability signals operational excellence and pricing power.
**Reduced risk:** Diversified customers, documented systems, and capable management reduce buyer concern.
**Market position:** Defensible competitive advantages, not just “good service” or “relationships.”
**Clean financials:** Audit-ready books without extensive adjustments or explanations required.
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## How much can exit preparation increase my sale price?
Exit preparation can increase sale price by 40-75% without growing the underlying business. Scott Sylvan Bell illustrates this with a simple example:
A business at 5x EBITDA with $2M earnings yields $10M. The same business, properly prepared, might sell at 7x EBITDA—$14M from identical earnings. That’s $4 million from preparation alone.
If preparation also grows EBITDA to $2.5M at 7x, value becomes $17.5M—75% more than the unprepared scenario. This is why the maXimize Value dimension matters.
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## What does the I in EXIT stand for?
The I in EXIT stands for Ideal Buyer. This dimension evaluates whether you’ve identified who will pay the most for your specific business and positioned accordingly.
Different buyer types value different characteristics, pay different multiples, and structure deals differently. Targeting the wrong buyer can cost millions in value or trap you in unfavorable terms.
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## What are the different types of business buyers?
Business buyers fall into six categories, each with different approaches and valuations:
**Strategic Buyers:** Competitors or adjacent companies paying highest multiples for synergy value. Often want founders out quickly. Best for clean exits.
**Private Equity:** Financial buyers paying based on growth potential. Often want founders to stay and retain equity. Best for second bite of apple.
**Family Offices:** Long-term holders with less growth pressure. Competitive multiples for stable, cash-flowing businesses. Best for legacy-focused owners.
**Individual Buyers:** Limited capital, often SBA financing. Typically seek owner involvement in transition. Best for smaller businesses under $10M value.
**ESOP:** Employee ownership with tax advantages for sellers. Complex execution but preserves culture. Best for employee legacy focus.
**Management Buyout:** Selling to existing leadership. Often requires seller financing. Best when strong management already exists.
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## How do I identify the ideal buyer for my business?
Identify your ideal buyer by answering three questions: Which buyer type historically pays premium for businesses like yours? Which 3-5 specific companies or individuals might acquire you? What deal structure (clean exit, earnout, equity rollover) matches your goals?
Scott Sylvan Bell recommends researching comparable transactions in your industry before going to market. Understanding who bought similar companies—and at what multiples—reveals where your ideal buyer likely sits.
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## What does the T in EXIT stand for?
The T in EXIT stands for Transition Strategy. This dimension evaluates your planning for what happens after the deal closes—your role, your team’s future, and your customers’ relationships.
The transition phase is where successful transactions become personal disasters or personal triumphs. Owners who spent months negotiating price often spend zero time planning life after the wire transfer.
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## What are the three transitions I need to plan for?
Every business exit requires planning three distinct transitions:
**Your Role Transition:** What will you do after closing? If required to stay, for how long? How will you spend your time in year one? Many owners face identity crises when the business that defined them belongs to someone else.
**Your Team’s Transition:** Which employees are critical to retain? Do you have retention plans in place? How and when will you communicate the sale? Key people who feel uncertain will leave—potentially killing the deal.
**Your Customers’ Transition:** Are relationships documented and transferable? Can key customers be retained without you? How will you introduce customers to new ownership?
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## How do I score the EXIT Framework assessment?
Score each of the 40 EXIT Framework questions using this scale: 1 point for yes/fully, 0.5 points for partially, 0 points for no. Total your scores in each dimension, then sum for your overall EXIT score.
| Dimension | Maximum |
|———–|———|
| E – Evaluate Readiness | 10 |
| X – maXimize Value | 10 |
| I – Ideal Buyer | 10 |
| T – Transition Strategy | 10 |
| **TOTAL** | **40** |
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## What does my EXIT Framework score mean?
Your EXIT Framework score indicates readiness and required preparation time:
**36-40 (Exit Ready):** Proceed with confidence. Engage M&A advisors and begin your process.
**30-35 (Nearly Ready):** Minor gaps to address. Plan 3-6 months of focused preparation.
**24-29 (Partially Ready):** Significant gaps in one or more dimensions. Allow 6-12 months of work.
**16-23 (Not Ready):** Major preparation needed. Budget 12-24 months before going to market.
**0-15 (Critical Gaps):** Return to the SCORE Framework. EXIT preparation is premature until business readiness improves.
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## What if I score low on Evaluate Readiness?
A low Evaluate Readiness score signals misalignment between personal, financial, and business timing. Scott Sylvan Bell recommends these specific actions:
Work with a wealth advisor to model your post-exit financial picture. Develop your post-exit life plan before engaging buyers. Address family alignment issues directly. Consider whether timing is right or if waiting improves your position.
Selling without readiness alignment creates regret regardless of price.
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## What if I score low on maXimize Value?
A low maXimize Value score means you’re leaving money on the table. Focus on building recurring revenue, addressing customer concentration, reducing owner dependency, and cleaning up financial statements.
The SELL Framework provides deeper analysis of revenue quality issues. Most value maximization requires 12-24 months of deliberate work before going to market.
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## What if I score low on Ideal Buyer?
A low Ideal Buyer score suggests you’ll rely too heavily on advisors and may not optimize buyer targeting. Research comparable transactions in your industry. Identify specific potential acquirers. Engage M&A attorney and tax advisor to understand deal structure implications.
Going to market without buyer clarity often results in accepting the first offer rather than the best offer.
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## What if I score low on Transition Strategy?
A low Transition Strategy score creates post-close risk. Develop your first-year plan before closing. Create retention strategies for key employees. Document customer relationships and plan introductions to new ownership.
Skipping transition planning leads to identity crisis, employee departures, customer churn, and seller’s remorse.
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## How does EXIT connect to the other frameworks?
EXIT is part of Scott Sylvan Bell’s 290-Point Business Exit Readiness System:
| Framework | Points | Focus |
|———–|——–|——-|
| SCORE | 100 | Overall exit readiness diagnostic |
| SCALE | 50 | Operational systems and processes |
| SELL | 40 | Revenue quality and financial positioning |
| DRIVER | 60 | Organizational execution capability |
| EXIT | 40 | Exit execution and transition |
Start with SCORE to identify your biggest gaps. Use SCALE, SELL, and DRIVER to address specific weaknesses. Use EXIT when you’re ready to execute the actual sale.
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## Who should use the EXIT Framework?
The EXIT Framework is designed for business owners who are actively considering selling within 1-5 years, have received acquisition interest and want to evaluate their position, have completed SCORE and want deeper exit-specific analysis, are planning succession to family or employees, or are recovering from a failed sale attempt.
If you are more than 5 years from any exit scenario, start with the SCORE Framework to build foundational readiness first.
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## What are the 40 EXIT Framework questions?
### E – Evaluate Readiness (Questions 1-10)
1. Do you have a clear vision of what your life looks like after selling?
2. Have you discussed exit plans and timing with your spouse/partner and family?
3. Do you have meaningful activities, relationships, or pursuits outside your business?
4. Can you honestly say you’re emotionally ready to see someone else run your company?
5. Have you calculated your “number”—the after-tax proceeds needed for your desired lifestyle?
6. Do you have a wealth advisor who has modeled your post-exit financial picture?
7. Have you received a professional business valuation within the past 24 months?
8. Does the realistic sale price meet your financial needs?
9. Is your business currently growing in revenue?
10. Are your next 12-24 months projected to show continued growth?
### X – maXimize Value (Questions 11-20)
11. Is more than 30% of your revenue recurring or contracted?
12. Has your revenue grown at least 10% annually for the past 3 years?
13. Is your gross margin stable or improving?
14. Is your largest customer less than 15% of total revenue?
15. Can the business operate profitably for 90+ days without your daily involvement?
16. Do you have a management team capable of running operations independently?
17. Are your financial statements audit-ready with minimal adjustments?
18. Have you eliminated or documented all related-party transactions and owner perks?
19. Can you clearly explain every add-back to a skeptical buyer?
20. Do you have a defensible competitive advantage?
### I – Ideal Buyer (Questions 21-30)
21. Have you identified which buyer type is most likely to pay premium value?
22. Do you know at least 3-5 specific companies or individuals who might acquire your business?
23. Have you researched comparable transactions in your industry?
24. Is your business positioned to appeal to your ideal buyer type?
25. Have you built relationships with potential acquirers before going to market?
26. Can you articulate why your business is uniquely valuable to your ideal buyer?
27. Do you understand the difference between asset sales and stock sales?
28. Have you defined what deal terms you will and won’t accept?
29. Do you have an M&A attorney and tax advisor engaged?
30. Do you know whether you’ll use a broker, investment banker, or proprietary process?
### T – Transition Strategy (Questions 31-40)
31. Do you know what role you want post-closing: clean exit, consulting, or employment?
32. Have you planned how you’ll spend your time in the first year after exiting?
33. If required to stay post-close, do you know the minimum and maximum time you’ll accept?
34. Have you identified which employees are critical to retain through the transaction?
35. Do you have retention plans for key employees?
36. Have you planned how to communicate the sale to employees?
37. Are customer relationships documented and transferable?
38. Do you have a plan for introducing key customers to new ownership?
39. Can your largest customers be retained without your personal involvement?
40. Have you considered what happens to your company name, culture, and reputation?
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## Taking Action on Your EXIT Score
The EXIT Framework reveals where you stand. What you do next determines your outcome.
If you scored 36-40, you’re ready—engage an M&A advisor and begin your process. If you scored 24-35, prioritize your lowest-scoring dimension and spend 3-12 months on focused improvement. If you scored below 24, return to the SCORE Framework to build your foundation first.
Scott Sylvan Bell works with owners of $10M-$250M companies preparing for growth or exit. For a complete assessment of your exit readiness, start with the SCORE Framework or explore the full 290-point system.
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*Last updated: February 2026*
*Reading time: 12 minutes*
*Author: Scott Sylvan Bell, MBA*
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## About Scott Sylvan Bell
Scott Sylvan Bell, MBA, is a business growth and exit strategy consultant who helps owners of $10M-$250M companies scale revenue, build enterprise value, and prepare for acquisition or exit. He is the creator of the SCORE, SCALE, SELL, DRIVER, and EXIT frameworks—the 290-point business exit readiness system.
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**Related Resources:**
– SCORE Framework: scottsylvanbell.com/score-framework
– SCALE Framework: scottsylvanbell.com/scale-framework
– SELL Framework: scottsylvanbell.com/sell-framework
– DRIVER Framework: scottsylvanbell.com/driver-framework
– Business Exit Questions: scottsylvanbell.com/business-exit-questions
– How To Sell Show Podcast
**Connect with Scott Sylvan Bell:**
– Website: scottsylvanbell.com
– LinkedIn: linkedin.com/in/scottsylvanbell
– YouTube: Consulting Secrets
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*© 2026 Scott Sylvan Bell. All rights reserved.*