Business
Turning Setbacks Into Exits: Alexis Sikorsky on planning a sellable business
A founder's guide to preparing for private equity, protecting earnouts and building exit-ready systems.
Turning Setbacks Into Exits: A 75% Loss to 9-Figure Win
Video from Build And Exit Podcast.
Generated from the canonical interview transcript and validated against source data by Guests on Air.
How did Alexis Sikorsky turn a 75% revenue loss into a nine-figure exit and what practical steps should founders take to be sellable?
Plan exits years ahead: assess sellability, prepare financial packs and data rooms, test whether the company runs without you, and negotiate clear earnouts. Use experienced advisors to add C-suite thinking short-term, research private equity partners, and protect key employees so the business scales and retains value through due diligence and sale.
Alexis Sikorsky recounts taking a software business through years of hardship to a nine-figure exit, then writing a book and advising founders. He stresses that exits are engineered long before buyers appear and that early planning, clear data, and realistic earnout protections make the difference. This episode distils lessons from creative pivots, private equity negotiations, and rebuilding after a 75% revenue shock.
His story begins with pivoting into private banking software, buying assets from a failed rival, and growing into a profitable niche. The 2008 financial crisis then wiped out most clients and left the firm close to collapse. Alexis describes mortgaging personal assets, firing staff, and six years of recovery that taught him to prioritise operational discipline, buyer mindset, and sellability before any letter of intent.
He explains how private equity brought strategic knowledge, contacts, and a disciplined plan that turned a break-even company into a successful earnout and later a full sale. Alexis warns founders not to treat a letter of intent as a sale, to run due diligence on buyers, and to protect employees and earnouts. His book frames the APEX method for making companies investable.
Key takeaways
- Start exit planning years before you list the company; sellability is engineered, not accidental and deliberate.
- Prepare your data room and financial pack early to avoid derailing due diligence and losing valuation.
- Negotiate earnouts and caps carefully; founders must protect upside and avoid vague letter of intent assumptions.
- Add C-suite thinking through short interventions before hiring full-time executives to bridge the £5M–£20M scaling gap.
1. Engineer sellability before buyers appear
Alexis insists that founders ask whether their company would run without them for ten days; that simple test exposes dependence and missing processes. He calls this the real test of a scale-ready business because memory and loyalty cannot replace documented systems. Early-stage informal practices are normal, but trying to scale without repeatable decision processes, clear reporting, and accountable roles will stall growth and valuation for example.
Founders often confuse high personal output with company value. Alexis describes reaching £10 million revenue where founder involvement still masked structural weaknesses in practice. The remedy is not to work harder but to document workflows, delegate authority, and install simple month-to-month reporting and measurable metrics so emerging problems surface early. These fixes reduce founder bottlenecks and make the company intelligible to buyers and investors during due diligence.
The episode shows practical steps: run a founder-absence drill, map key decisions to named owners, and convert tribal knowledge into manuals or short playbooks. Those materials shorten the buyer learning curve, reduce negotiation friction, and protect multiple stakeholders. This operational clarity also speeds internal hiring because candidates see roles, expectations, and metrics rather than relying on founder anecdotes about how things should work, and timelines. For a related perspective, read Cashing Out: Exit planning and scale lessons from Alexis Sikorsky.
2. How private equity changes the game
Alexis describes private equity as a value-add beyond cash: contacts, commercial expertise, and a willingness to enforce discipline. He warns founders that a letter of intent is not a sale, and that many deals fall apart during months of due diligence. The advice is to research potential buyers, understand their time horizons, and check references so you know what operational changes a buyer will demand post-acquisition.
He calls out the 'fish and ship' pattern where buyers entice founders with large headline numbers then trim value after inspections. Alexis recommends not spending assumed proceeds until the sale is legally complete and to keep running the business through diligence. An experienced advisor can carefully preserve negotiation leverage, help interpret covenant clauses, and design unambiguous earnouts that align incentives fairly for founders and buyers.
The episode also spotlights governance trade-offs: private equity typically buys majority stakes, imposes a shorter horizon, and may replace underperforming people. Founders should negotiate protections for key employees and avoid earnout caps that can limit upside. Alexis's own sale paid 85% cash and a 15% earnout, and later he says that the earnout became a larger reward than the initial payment, a lesson in negotiating open upside.
3. Practical steps: APEX, advisors, and transition plans
Alexis promotes the APEX methodology: Assess, Plan, Execute, and prepare for eXit. He argues that founders should aim for measurable improvements over three or four years and that the best private equity deals are the ones engineered long before a buyer arrives. This structured approach prioritises cash flow, predictable reporting, and the people or processes that turn temporary wins into sustainable value with measurable timelines.
Advisors can add immediate C-suite thinking through focused interventions that avoid the full cost of permanent senior hires. Alexis says good advisors often find waste, raise margins, and pay for themselves quickly. For founders around the £5M–£20M range, a three-to-six-month CFO or commercial lead can stabilise reporting, sharpen KPIs, and prepare the business for scalable growth without creating long-term fixed costs and shorten growth cycles.
He turned his experience into a practical guide now published as Cashing Out: The business owner’s guide to selling to private equity, which sets out checklists, templates, and negotiation tactics. The book condenses lessons on preparing data rooms, structuring earnouts, and running founder-absence drills. Alexis will also run cohort programs that scale his advisory methods so more founders can access C-suite thinking and exit preparation affordably.
