Building A Leadership Team Before A Family Business Sale

Selling a family business is one of the biggest decisions an owner will ever make. It’s not just about the business itself—it’s about the people, the legacy, and often, the identity that comes with it. But when the time comes to sell, emotion must be balanced with a clear strategy. Buyers don’t just look at what the business is today—they want to know what it will be without you.

One of the biggest risks in any sale is an over-reliance on the owner. If the business can’t function without them, buyers will hesitate, push for a lower price, or walk away entirely. On the other hand, if a strong leadership team is in place, it reassures buyers that the business will remain stable, profitable, and well-run long after the sale. That’s where real value is created.

Why Leadership Matters In A Sale

Every buyer asks the same fundamental questions. Who will run the business when the owner steps back? Will customers, suppliers, and employees stay? Can the business continue to grow without the family’s involvement?

If these questions don’t have clear answers, buyers see risk. And risk lowers value.

When a business has the right leadership in place, it makes a sale not only easier but more attractive. The company is seen as a credible, investable proposition rather than a risky handover. It attracts more interest, commands a higher valuation, ensures a smoother transition, and gives the owner more flexibility in shaping their exit.

Despite this, many owners underestimate just how long it takes to put the right team in place. If a sale is even a possibility within the next five years, now is the time to start preparing.

How To Build A Leadership Team That Strengthens A Sale

Start Early – It’s Not A Quick Fix

Recruiting, integrating, and empowering a leadership team takes time. It’s not just about hiring the right people—it’s about ensuring they work together effectively and genuinely take responsibility for running the business.

Too many owners try to step back just months before a sale, but buyers see through it. The businesses that achieve the best valuations are those with leadership teams that have already been operating independently for years.

Strengthen Leadership In Key Areas

Buyers want to see a leadership team that extends beyond the family and is strong in the areas that matter most. If the owner is the CEO, there needs to be a transition plan. If financial control has always sat with the family, a professional finance lead must be in place. Commercial and operational leadership needs to be structured so that key relationships and processes continue seamlessly. HR and people management must be professionalised, particularly in businesses where culture has been closely tied to family influence.

The ultimate test is simple: if the owner steps back today, can the business continue to run effectively without them? If not, gaps need to be addressed.

Balance Family And Non-Family Leadership – And Strengthen Governance

Many family businesses hesitate to bring in external executives, but buyers want to see a balance. The strongest teams include family members in leadership roles only where it makes strategic sense, not just out of tradition. External hires can bring fresh expertise, and independent non-executive directors (NEDs) add credibility, helping to strengthen governance and decision-making.

A board made up entirely of family members can be a red flag for buyers, signalling that decisions may be too insular or subjective. Having at least one or two independent NEDs reassures buyers that governance is robust and professional, not just family driven.

Move From Informal To Professional Leadership Structures

In many family businesses, major decisions still happen over Sunday lunch or in a family WhatsApp group. That may work internally, but buyers want to see clear governance and structured decision-making.

Roles and responsibilities should be properly defined, ensuring leadership operates based on function and expertise rather than family hierarchy. Authority must be delegated properly—leaders need to have real decision-making power, not just the illusion of it. If key people plan to leave after the sale, a documented succession plan must be in place well in advance.

A business that operates on systems and leadership accountability—not just familiarity and trust—is a business that will attract stronger buyers and better offers.

Incentivise The Leadership Team To Stay

One of the biggest concerns for buyers is whether key people will stay after the sale. Without retention plans in place, they will factor that uncertainty into their offer.

Aligning leadership incentives with a successful sale creates confidence on both sides. Retention bonuses can ensure that key leaders commit to staying for a set period post-sale, while earn-out structures tie compensation to business performance after the transaction. Long-term incentive plans and, in some cases, equity participation can also help align interests and keep leadership invested in the business beyond the sale.

Owners can’t assume that loyalty alone will keep people in place—certainty is needed, and that requires the right structures and conversations well ahead of a sale.

Prove That The Business Can Run Without You

For many family business owners, this is the hardest step—letting go. Buyers need to see that the company can genuinely operate without daily involvement from the family, and the only way to prove that is to step back before the sale.

The transition should begin long before buyers start due diligence. The leadership team must be making real decisions and running the business day to day. Relationships with customers and suppliers should be strong beyond the owner, ensuring stability throughout and after the sale.

A business that can stand on its own is a business that will continue to thrive, and that’s what buyers will pay a premium for.

Final Thought – Leadership Drives Value

A well-run business commands confidence, attracts stronger buyers, and ultimately achieves a higher sale price. Buyers want stability and a business that isn’t reliant on one person. That doesn’t happen overnight—it takes years of preparation.

If selling is on the horizon, the question isn’t whether you should prepare—it’s how soon. The earlier leadership is strengthened, the more control and choice the owner has over the sale.

At TWYD, we work with family businesses at every stage of this journey—whether a sale is five years away or just around the corner. If you’d like to explore what this means for your business, we’re here to help.

About the Author - David Twiddle is the Managing Partner at TWYD & Co, an executive search and leadership advisory firm dedicated to family businesses. Having built and successfully prepared three of his own family’s businesses for sale, he knows first-hand the challenges of stepping back, putting the right leadership in place, and ensuring a business is sale ready. Through TWYD, he helps business families strengthen leadership, structure transitions effectively, and build value—whether they’re preparing for a sale or planning for the future.