--- title: "Working With an Investment Banker or Sale Advisor Guide" description: "Do you need an investment banker to sell your business? Learn what bankers and advisors do, who else belongs on your team, how fees work and how to choose." url: https://capstreet.multisites.ai/guides/working-with-an-investment-banker-or-advisor publisher: Capstreet phone: +1-713-332-2700 contact: https://capstreet.multisites.ai/contact --- # Working with an investment banker or advisor when you sell Most owners should work with a deal team when selling to private equity. That team includes a lawyer, an accountant, a tax or wealth adviser and often an investment banker or sell-side advisor who runs the process. You can sell without a banker, but you carry the risk of mistakes. Owner guideUpdated November 10, 20267 min read ![Downtown Houston skyline, home of Capstreet](https://capstreet.multisites.ai/_astro/houston-skyline.CI1wBZKY_Z21lbxH.webp) ## A team, not one person A sale needs a lawyer, an accountant and a deal adviser, plus personal planning help. ## A banker runs the process Sell-side advisors prepare materials, find buyers, and negotiate terms for you. ## Hire early Personal planning often needs to start years before a sale. ## Check fees and fit Ask how the advisor is paid, who does the work and which deals they have closed. ## Do you need an investment banker to sell your business? You do not need one by law, but most owners selling to private equity benefit from expert help. Altair Advisers wrote in 2025: “This is not a DIY project.” The firm says buyers have “well-oiled ‘deal teams’” and that you need a team too. A banker, also called a sell-side advisor or M&A advisor, works for you. The job is to prepare your company, find the right buyers, run the process and help negotiate. You still make every decision. Here is a quick test. You may be able to manage with a lawyer and an accountant if: - You already have a buyer in mind and trust the relationship. - Your company is small and the deal is simple. - You have bought or sold companies before. You likely need a banker or advisor if: - You want more than one offer to compare. - You do not have time to run a process and the company at once. - You have never sold a company. - The deal has complex parts, such as rollover equity, an earnout or several owners. This guide explains each role, how fees work and how to choose. It does not recommend any firm. ## What does an investment banker do for a seller? A sell-side banker manages the sale from preparation to closing. The work happens in stages, and good advisors do most of it for you so you can keep running the company. Stage What the advisor does What you do Prepare Reviews financials, builds a story, helps with add-backs Provide records and answer questions Market Builds a list of buyers, drafts a confidential memo, sends outreach Approve buyers and materials Run the process Handles buyer calls, management meetings and bids Present your business Negotiate Compares offers, pushes on price and terms Decide what matters most Diligence Coordinates the data room and requests Support your team Close Works with lawyers to finish documents Sign and plan the transition The marketing step often uses a [confidential information memorandum](https://capstreet.multisites.ai/glossary/confidential-information-memorandum) and a [non-disclosure agreement](https://capstreet.multisites.ai/glossary/non-disclosure-agreement) to keep your sale private. Diligence covers a [data room](https://capstreet.multisites.ai/glossary/data-room) and a review of your records. Our [due diligence checklist](https://capstreet.multisites.ai/guides/due-diligence-checklist-for-owners) lists what buyers ask for. ## Who else belongs on your team? You need a team, and Altair Advisers says you need two: “one to assist with the business and one to assist on the personal side.” The firm describes both groups in its 2025 article. Team Members Job Business team Attorney, accountant, M&A financial professionals Contracts, financial review, deal terms Personal team Estate attorney, accountant, wealth adviser Taxes, estate planning, what to do with the proceeds Altair Advisers says there are many planning opportunities that need to happen before a sale, “sometimes years before.” That is why you should hire your personal advisers early. They can help you plan before the price is set. Alpine Investors, a private equity firm, notes that its team works “with you and your legal counsel to finalize the terms of a purchase agreement.” In other words, a lawyer on your side is a normal part of the deal. Ask your lawyer to review the [letter of intent](https://capstreet.multisites.ai/guides/letter-of-intent) before you sign anything. Tax and legal rules depend on your facts. Ask your own tax adviser and attorney. This guide does not give tax or legal advice. ## How do investment bankers get paid? Bankers are paid in different ways, so read the engagement letter closely. Ask your lawyer to review it before you sign. Do not rely on a phone call or an email summary. Fee type How it works What to ask Retainer Regular payments while the advisor works How much, how long and is it credited at closing? Success fee A fee paid when the deal closes, often a share of the price What share, and of which value? Expense reimbursement You repay costs such as travel and research Is there a cap? Tail clause A fee owed if you sell to a buyer the advisor contacted after the contract ends How long does it last? The numbers vary by advisor and deal size, so ask for the full terms in writing. First Citizens Wealth reminds owners that “accounting, legal and advisory fees can accumulate quickly, so you’ll want to plan for these costs well before closing.” Also ask how the advisor’s pay lines up with your goals. A fee based only on closing a deal can push toward closing quickly. A fee based on price can push toward value. Neither is wrong, but you should know the incentive. ## How do you choose an investment banker or advisor? Choose an advisor on experience in your size and industry, who does the work, and references from owners they represented. Titles tell you little. Results and fit tell you more. Ask each candidate: 1. How many deals like mine have you closed in the last three years? 2. Who on your team will do the work, and who will I speak with each week? 3. Which private equity firms and other buyers do you know in my industry? 4. How do you pick which buyers to contact, and how do you protect my confidentiality? 5. How will you value my company, and what do you need from me? 6. What are your fees, and what happens if the deal does not close? 7. Can I speak with two owners you represented, including one whose deal did not go as planned? 8. What do you do if buyers lower their price after diligence? Meet at least two or three candidates. Watch how they listen. A good advisor asks about your goals, your team and your timeline before they talk about price. ## When should you bring in an advisor? Bring in an advisor 12 to 24 months before you want to sell, if you can. Early help is cheaper than rushed help. It gives you time to fix records, reduce risks and plan taxes. Our guide on [how to prepare your company for a private equity sale](https://capstreet.multisites.ai/guides/how-to-prepare-your-company-for-a-private-equity-sale) describes the work. Timing What an advisor can do 24 months out Review financials, spot gaps, advise on timing 12 months out Clean up records, help with a quality of earnings review, plan taxes 6 months out Prepare materials and build a buyer list Process Run outreach, meetings and negotiation After the LOI Support diligence and closing Altair Advisers wrote that you need to “engage the PE firm years in advance” if you plan to stay on after closing, because the deal can include a long handoff. Early talks with an advisor help you plan that timeline. See our guide on [what to expect after you sell](https://capstreet.multisites.ai/guides/what-to-expect-after-you-sell) for the other side of the deal. ## What does an advisor do about valuation and structure? An advisor helps you understand what your company may be worth and what offers really mean. They compare headline price with cash, rolled equity and later payments. They also test whether the buyer’s add-backs and [EBITDA](https://capstreet.multisites.ai/glossary/ebitda) match yours. Our guide on [how private equity values a business](https://capstreet.multisites.ai/guides/how-private-equity-values-a-business) explains the math. Our guides on [rollover equity](https://capstreet.multisites.ai/guides/rollover-equity) and [earnouts](https://capstreet.multisites.ai/guides/earnouts) explain the pieces that change what you collect. Altair Advisers offers one useful rule: “If the price does not make sense without the earnout payments, then the transaction does not make sense.” An advisor can help you apply that rule to every offer. ## What can go wrong if you skip professional help? The common problems are a weak price, missed terms and a stalled deal. Altair Advisers warns that these transactions “can fall apart quickly and often do not play out as intended.” A buyer’s deal team does this work every day. You sell a company once. Typical gaps for owners who go alone: - Only one offer, so no comparison on price or terms. - Add-backs that a buyer rejects in diligence, which lowers the price late in the process. - A letter of intent with exclusivity terms that favor the buyer. - Tax steps missed because planning started after the price was set. - Less time to run the company, so results slip during the sale. None of these is certain, and a careful owner with a good lawyer can avoid many of them. Still, weigh the cost of an advisor against the cost of one of these errors. ## What if you want to sell without a banker? You can sell without a banker, but plan for more work and more risk. Some owners talk directly with a buyer they already know. If you go that way: 1. Hire a lawyer who does deals, not a general practice lawyer. 2. Hire an accountant to prepare for a quality of earnings review. 3. Talk to at least two buyers, so you have a comparison. 4. Ask a trusted adviser to review every offer. 5. Read the exclusivity terms in the letter of intent with care. Our [exclusivity period](https://capstreet.multisites.ai/glossary/exclusivity-period) entry explains the term. Our guide on [how to choose a private equity partner](https://capstreet.multisites.ai/guides/how-to-choose-a-private-equity-partner) gives you the questions to ask any buyer. ## Next step Whether or not you use an advisor, you can start a confidential talk with Capstreet. Read the [deal criteria](https://capstreet.multisites.ai/deal-criteria) page to see what we look for, then call 713-332-2700, email [connect@capstreet.com](mailto:connect@capstreet.com) or use the [contact page](https://capstreet.multisites.ai/contact). ## Frequently asked questions ### Do I need an investment banker to sell my business? No law requires one, but most owners benefit from expert help. Altair Advisers wrote in 2025 that a sale to private equity is not a do-it-yourself project and that owners need professionals who represent them. A banker also frees your time to keep running the business. ### What does a sell-side advisor do? A sell-side advisor works for you, the seller. The advisor helps prepare financials and marketing materials, finds and screens buyers, runs the process, helps negotiate price and terms, and coordinates diligence with your lawyer and accountant. Ask each advisor which of these tasks they handle themselves. ### How do investment bankers get paid? Fee models vary, so ask for the terms in writing. Common structures include a monthly retainer and a success fee paid at closing. Compare the full cost against the value of the work, and ask your lawyer to review the engagement letter before you sign. ### What is the difference between a business broker and an investment banker? Titles overlap, and no single rule separates the two. Brokers often work on smaller sales and bankers on larger, more complex ones. Judge by experience: ask for deals in your size and industry, who handles your account, and references from owners they represented. ### When should I hire a sale advisor? As early as you can, ideally 12 to 24 months before you want to sell. Early help lets you fix records, plan taxes and test the market before pressure builds. Altair Advisers notes many planning steps need to happen before a sale, sometimes years before. ## Terms on this page - [Confidential Information Memorandum](https://capstreet.multisites.ai/glossary/confidential-information-memorandum) - [Non-Disclosure Agreement](https://capstreet.multisites.ai/glossary/non-disclosure-agreement) - [Quality of Earnings](https://capstreet.multisites.ai/glossary/quality-of-earnings) - [Exclusivity Period](https://capstreet.multisites.ai/glossary/exclusivity-period) - [Letter of Intent](https://capstreet.multisites.ai/glossary/letter-of-intent) - [Rollover Equity](https://capstreet.multisites.ai/glossary/rollover-equity) - [Private Equity](https://capstreet.multisites.ai/glossary/private-equity) - [Due Diligence](https://capstreet.multisites.ai/glossary/due-diligence) - [Add-Backs](https://capstreet.multisites.ai/glossary/add-backs) - [Data Room](https://capstreet.multisites.ai/glossary/data-room) ## Sources 1. [Altair Advisers: 5 Things to Know About Selling Your Business to Private Equity](https://altairadvisers.com/5-things-to-know-about-selling-your-business-to-private-equity/) 2. [Altair Advisers: 5 Things to Know About Selling Your Business to Private Equity](https://altairadvisers.com/5-things-to-know-about-selling-your-business-to-private-equity/) 3. [First Citizens Wealth: What to know before selling your business to private equity](https://www.firstcitizens.com/wealth/insights/business-planning/selling-your-business-to-pe-firms) 4. [Alpine Investors: What to Know Before Selling your Business to Private Equity](https://alpineinvestors.com/resource/selling-your-business/) Written by Capstreet and checked against the sources above on November 10, 2026. Market figures and deal practice change, and nothing here is legal, tax or investment advice. Ask your own advisers before you act. ## Keep reading - [The due diligence checklist for owners selling to private equityDue diligence is the buyer's check of your business after you sign a letter of intent. Private equity firms review five areas: financial (quality of earnings), operations, tax, HR and benefits, and legal. Owners who gather clean records before the process starts shorten it and face fewer surprises.](https://capstreet.multisites.ai/guides/due-diligence-checklist-for-owners) - [How to prepare your company for a private equity sale: a 12 to 24 month planStart 12 to 24 months before you plan to sell. Clean up your financials, support every add-back, build a team that can run without you, spread your customer base and organize your records. Buyers pay more for earnings they can verify and a business that does not depend on one person.](https://capstreet.multisites.ai/guides/how-to-prepare-your-company-for-a-private-equity-sale) - [The letter of intent: what it says, what binds you and what to negotiateA letter of intent (LOI) is a short document where a buyer states the price and main terms it proposes. Most terms are non-binding. A few, usually exclusivity and confidentiality, do bind you. Signing starts diligence and takes your company off the market, so negotiate it with a lawyer.](https://capstreet.multisites.ai/guides/letter-of-intent) - [How to sell your business to private equitySelling to private equity means a firm buys most of your company, usually with a mix of cash at close and equity you keep. You work through an intro call, a data request, a letter of intent, diligence and a close. Most owners stay on and invest alongside the buyer.](https://capstreet.multisites.ai/sell-your-business-to-private-equity) - [Capstreet deal criteria: the companies we look forCapstreet looks for entrepreneur-owned business services companies with $3 to $15 million of EBITDA. We make primarily majority investments, and entrepreneurs reinvest alongside Capstreet. We want a tenured team, solid financials, a defensive business model, untapped growth potential and a niche advantage. We invest across 12 industries.](https://capstreet.multisites.ai/deal-criteria) - [What to expect after you sell your business to private equityAfter a private equity sale, you usually stay on as CEO or in a defined role, answer to a board, report monthly and set goals with new partners. Your rolled equity rides on the next sale. Most surprises come from unspoken expectations, so settle your role, authority and plans for your team before closing.](https://capstreet.multisites.ai/guides/what-to-expect-after-you-sell) ## Ready to get started? Let’s talk. Tell us about your company and what you want next. Conversations are private, and there is no obligation. [Start a conversation](https://capstreet.multisites.ai/contact) [(713) 332-2700](tel:+1-713-332-2700)[connect@capstreet.com](mailto:connect@capstreet.com) ![Capstreet team members at a Houston elementary school for Houston Reads Day](https://capstreet.multisites.ai/_astro/houston-reads-day.DxNd9bIr_tggWP.webp)