How To Sell A Coaching Business: 4 Strategic Steps
Ever wonder why some coaching businesses are scooped up for seven figures while others barely catch a buyer’s attention? The truth is, most coaching business owners do not know how to sell a coaching business and miss critical steps that make their companies attractive, sustainable, and truly sellable.
In this article, you’ll learn a step-by-step approach based on interviews with eight successful founders who each sold their coaching business for a seven-figure exit. This isn’t just theory but a workable blueprint from entrepreneurs who turned their expertise into life-changing exits.
So, if you’re a business owner offering coaching to your clients, here’s the roadmap to building a sellable coaching business.
How To Sell A Coaching Business for Maximum Value
Step 1: Emphasize a Unique Niche and Build A Community
Step 2: Build Operational Independence from the Founder
Step 3: Structure Flexible and Creative Deal Terms
Step 4: Navigate the Emotional and Psychological Aspects of Selling
Extra Resource You Might Like: How Much Can You Sell Your Business For.
1. Emphasize a Unique Niche and Build A Community
In the crowded coaching industry, a unique niche isn’t just a “nice-to-have”—it’s what draws potential business buyers like a magnet. Buyers want to see a business with a loyal following, a defined niche, and an engaged community. A strong niche and community not only generate consistent income but also show future growth potential, which is exactly what buyers look for.
Consider Lauren Gaggioli, founder of Higher Scores Test Prep, a business focused on niche coaching for SAT/ACT preparation. By building a community of dedicated students and parents, she created a business with staying power. Her engaged community gave her business an edge over generic test prep providers, making it attractive to buyers who saw immediate value in her audience. The lesson? Invest time in building a community that knows, likes, and trusts your business, as this alone significantly increases the attractiveness and valuation of your business.
Practical Tips:
Identify Your Niche: Define who your coaching serves best—whether it’s C-suite executives of color, foreign students applying for Harvard, or another niche. Become a go-to expert in that field.
Build Community: Use social media and community platforms to connect with your audience and provide value beyond your coaching. Regular engagement builds loyalty.
Leverage Content Marketing: Share knowledge through blogs, podcasts, or webinars to foster a stronger bond with your audience and establish your business as a thought leader in your niche.
Extra Resource You Might Like: From Personal To Business Brand: 3-Steps Shift.
2. Build Operational Independence from the Founder
We cannot stress this enough: a coaching business that relies solely on the founder’s expertise and presence is challenging to sell. Buyers want a business that runs smoothly without the original owner in the day-to-day operations. Transitioning from being the face of the business to establishing systems that make the business self-sustaining is crucial.
One example is Caitlin Pyle, founder of Proofread Anywhere, who reduced her involvement by hiring a CEO to manage daily operations. She built systems and processes so the business could run independently. When she stepped back, her business still thrived, proving to potential buyers that it was sustainable and scalable without her direct involvement. This shift increased her business’s value because it no longer depended on her presence, making it a true asset that could be handed off seamlessly.
Practical Tips:
Document Key Processes: Create standard operating procedures (SOPs) for every aspect of your business, from client onboarding to marketing workflows.
Empower Your Team: Delegate roles to trusted team members and let them manage essential operations to reduce dependency on you.
Consider Rebranding: If your name and face is central to the brand, do a rebrand that focuses on the business itself rather than you, making it easier to transition ownership.
Extra Resource You Might Like: How To Scale Your Services Beyond You. A 3-Step Guide.
3. Structure Flexible and Creative Deal Terms
In almost all of the exits of the coaching businesses we investigated, deal structures went beyond a simple cash exchange. Seller financing, earn-outs, and performance-based payments were common and allowed for win-win deals that satisfied both the buyer’s and the seller’s needs. A flexible deal structure makes your business accessible to a wider range of buyers and provide security for you post-sale.
Gina Horkey’s Fully Booked VA is a prime example. She structured a seller-financing deal with her buyer, allowing the buyer to pay over three years instead of upfront. This arrangement not only eased the buyer’s financial commitment but also offered Horkey peace of mind that her business would remain financially stable post-sale. Deals like these benefit both parties, making the exit smoother and more appealing for buyers who may otherwise find the price tag daunting.
Practical Tips:
Consider Seller Financing: Offer financing options to buyers who may need flexibility in payments, increasing your pool of potential buyers.
Incorporate Earn-Outs: Use performance-based payments where you receive part of the purchase price based on the business hitting revenue milestones, aligning incentives for growth.
Explore Stock or Equity Deals: If your business is poised for significant growth, consider taking equity or stock options as part of the deal for future upside.
4. Navigate the Psychological Aspects of Post-Exit Life
Selling a business you’ve built from scratch isn’t a financial decision, but an emotional one. For many founders, the exit brings mixed feelings of excitement, loss, and even grief. Recognizing and managing these emotions is essential to make your transition into post-exit life smoother.
Gabrielle Juliano-Villani, founder of Colorado In-Home Counseling, experienced burnout and realized it was time to step away. The sale gave her the opportunity to transition her company and take on a new chapter in her life. However, the emotional journey didn’t end at the sale—she stayed on for a year to ensure the business continued thriving, which also helped her transition emotionally. Acknowledging the psychological aspects makes the post-exit process more rewarding and less overwhelming.
Practical Tips:
Reflect on Your Why: Identify why you want to sell. Whether it’s burnout, a desire for new challenges, or personal life changes, understanding your motivation helps you process the transition.
Prepare for Post-Exit Life: Plan what comes next. Knowing what you’ll do after selling (whether it’s a new project, a sabbatical, or retirement) helps reduce uncertainty.
Stay Involved if Needed: Offering to stay on as an advisor or consultant post-sale eases the transition, preserving the business’s culture and client relationships.
One More Critical Factor for Achieving a 7-Figure Exit
When aiming for a big exit it's crucial to recognize that preparation is key, and it should begin long before any potential buyer enters the picture. Successful founders who have achieved big exits emphasize that this process isn't a last-minute endeavor. Instead, they dedicated months, or even years, to meticulously preparing their businesses for sale. This extended preparation period serves multiple purposes:
It allows you, as the founder, to identify and address potential challenges that might deter buyers or lower the business's value.
It provides ample time to position your business as a reliable, adaptable, and financially robust entity.
It enables the implementation of systems and processes that demonstrate the business's ability to thrive without your constant involvement.
It offers opportunities to strengthen the brand, expand the customer base, and solidify market position.
It allows for the fine-tuning of financial records and the optimization of key performance indicators that buyers will scrutinize.
Extra Resource You Might Like: 2,400 Businesses Per Day: How To Exit In A Buyer’s Market
By investing time in in knowing how to sell a coaching business, thorough preparation, founders significantly increase their chances of not just achieving a sale, but securing a truly impressive 7-figure exit that reflects the true value and potential of their coaching business.
