What happened
Dennis Beker, a partner at the law firm Founders, laid out how Canadian business owners should prepare to sell, as reported by Talent Canada. His main point is that a sale is a multi-year process, not a one-day event.
He says owners should be able to prove that what they tell a buyer the company owns is actually owned by the company. That means current corporate records, clear share ownership, and IP assignments from founders, contractors and key employees. Buyers will also study the financials closely and may run a quality of earnings analysis, so the books need to be clean and easy to follow.
Beker recommends bringing in an M&A-experienced lawyer 1 to 2 years before a possible sale, and no later than the letter of intent stage. He also expects sellers to stay on for roughly 3, 6 or 12 months after closing. Many deals include earn-outs or vendor takebacks, so a cooperative, transparent seller is less likely to end up in a dispute over those payments.
Why it matters if you are hiring
Most of this checklist depends on people. Clean books and a defensible quality of earnings review need a capable controller or finance lead, and a messy close process is hard to hide from a buyer. If your finance team is thin or relies on one person, fix that before a buyer finds it.
IP assignments are a hiring issue too. Anyone who builds product, code, recipes or processes for you, whether employee or contractor, should have signed paperwork that assigns the work to the company. Check this for current staff and for the contractors you bring in on short engagements.
Beker also points to employee obligations, especially if not everyone will stay after closing, and to contracts that may need notice or consent on a sale. Owners who plan to exit should know which roles a buyer will want to keep, and whether those people are tied in by clear agreements and a real reason to stay. Post-closing, a founder who stays 6 to 12 months needs a strong operations or finance second to hand over to.
One thing to do this week
List every employee and contractor who has created IP or holds key knowledge of your operations or books. Mark who has a signed IP assignment on file and who does not, then send the gaps to your lawyer.
Traverse Staffing helps Canadian owners and finance leaders find controllers, accountants and operations managers who can keep a business sale-ready and steady through a transition.