My dad ran a small e-commerce business making children’s bedding sets. People often asked if my brother or I would take it over one day, but he always told them he wanted us to follow our own paths. When retirement came into view, competition was fierce and selling wasn’t as straightforward as he hoped. He had built something with care and creativity, yet the market didn’t seem to recognize the full value of what he’d created.
His experience is far from unique. Across the country, Baby Boomer business owners are wrestling with the same challenges and holding on to their companies longer than expected, uncertain of how or when to step away. Instead of retiring at 65, many are waiting until around 71. The National State of Owner Readiness Report from the Exit Planning Institute shows that while 77% of boomer owners plan to exit in the next decade, only 57% expect to do so in the next five years. That gap highlights the tension: owners know transition is coming, but many are still holding on in the meantime. It’s part of a much larger shift sometimes called the “silver tsunami,” as millions of owners near retirement without a clear plan for succession.
Defining the Silver Tsunami
The term "silver tsunami" describes a demographic shift where a substantial number of Baby Boomer business owners reach retirement age. The United States Census Bureau states that more than half of U.S. business owners are already 55 or older, underscoring how significant this transition will be for small businesses.
As they exit the workforce, their businesses face the challenge of finding new ownership or risk closure. The Small Business Administration (SBA) likewise estimates around 10 million Baby Boomer–owned businesses will change hands in a 10-year span. This represents a majority of America’s privately-held businesses potentially entering the market (on the order of 65–75% of all small firms), according to Minority Business Review.
The Exit Planning Institute’s “State of Owner Readiness” research indicates that only 20–30% of businesses who go to market actually sell, suggesting that 70–80% may not successfully transfer via sale.
Many businesses owned by Boomers are deeply rooted in local communities. The prospect of these businesses changing hands or closing affects local economies, job markets, and community identity. Thus, the "silver tsunami" is not just about numbers; it impacts the very fabric of society, as evidenced by reports indicating potential job losses in the millions if no successors are found or leading to potential local economic declines of up to 25% in affected regions (Owned & Operated and Gallup News).
Why Boomers Hold On
From ties to personal identity and purpose to policy and financial hurdles, there are many reasons why Boomers may hold on to their businesses:
Identity and purpose
For many Boomers, the business is more than a livelihood — it’s their identity, community, and life’s work. Research shows that stepping away too abruptly can trigger deep emotional strain: founders often experience identity loss, uncertainty about their future role, loneliness, or a sense of drifting without direction. In Pauley’s 2024 study of entrepreneurs nearing retirement, the exit process is described not merely as a financial transition, but one that tests well-being and self-concept.² In interviews with former entrepreneurs, Columbia Business School found that even a financially successful sale often leaves sellers feeling “rudderless,” disconnected from the community that defined them.³ Because the business is so tightly woven into daily routines, social status, and purpose, many owners delay exit unless the successor or structure convincingly preserves their legacy.
Financial need
Many Baby Boomer business owners depend heavily on their businesses to fund retirement, either by drawing income from operations as long as they keep working, or by planning to sell the business as their “nest egg.”
The U.S. SBA’s Office of Advocacy has shown that older small business owners are far less likely than other workers to have significant retirement account savings, which means they rely disproportionately on the value of their businesses and business-related assets for retirement security.
Surveys from organizations like the Transamerica Center for Retirement Studies echo this point. Many small business owners list the eventual sale of their company as their primary or one of their main retirement strategies, underscoring the financial stakes.
Therefore, concerns about securing a comfortable retirement fund may lead owners to delay the sale.
No clear successor
Traditional family handoffs are declining — fewer than 15% of owners expect to pass their company to family members. Meanwhile, a third of owners over 50 report difficulty finding any buyer at all, according to Project Equity.
Valuation gaps
A valuation gap isn’t just a number — it’s emotional. Many Boomers believe the marketplace doesn’t fully value what they built: the client relationships, internal systems, proprietary processes, unique culture, or institutional knowledge. To them, accepting a “market offer” below what they feel the business should be worth feels like a betrayal. Rather than sell at a price they consider beneath their legacy, many delay in hope that the market will “correct” or that a more sympathetic buyer will come along.
In today’s small business market, multiples are under pressure: median earnings multiples (SDE/EBITDA) across industries often fall in the 2–4× range for many “main street” businesses, according to BizBuySell reports. When a Boomer expects 6× or more because of their history or emotional investment, that disconnect can be a deal-breaker before the process even begins.
So the valuation gap becomes a psychological hurdle: the owner holds on, believing that with time, either buyer sentiment or economic conditions will shift in their favor.
Market timing
When owners say “I’ll wait,” it’s often because they’re watching real forces — not just whims. The market has become volatile for several structural reasons:
Rising interest rates increase the cost of capital and reduce valuation multiples, making buyers more conservative and deals harder to finance.
Tighter SBA rules and loan structures add friction to seller-financed deals (which Boomers often rely on) — making buyers more cautious.
Sector-specific headwinds (supply-chain pressures, inflation, labor constraints) make revenue forecasts less certain.
Macro uncertainty (recession fears, geopolitical risk, regulation) makes both buyers and sellers more impatient or risk-averse.
In Q2 2025, for example, small business transactions fell ~4% year over year, according to a BizBuySell Insight Report, and manufacturing deals dropped nearly 28%, according to Community Economic Development. Nearly half of owners surveyed called the market “volatile.” These signals reinforce a feedback loop: owners wait for better conditions, which suppresses deal flow and contributes to continued market sluggishness.
Policy and financing hurdles
Recent SBA changes now require that seller notes can only cover up to 50% of a buyer’s equity injection, and those notes must be on full standby. This raises the upfront cash buyers need and slows deals, leaving owners in limbo.
Other reasons
A 2024 Gallup survey found that some owners explained they had no succession plan because their company relied entirely on their own work (such as in the case of an artist) making it impossible to continue once they retire. The second most common explanation was that their business was simply too small (31%). Another 18% said they were too preoccupied to plan ahead. Less frequently, respondents pointed to the business being too new (7%), needing professional guidance (7%), or requiring more information (5%).
What This Means for Buyers
Build trust by honoring their legacy
If you’re a first-time buyer or a search fund entrepreneur (pursuing Entrepreneurship Through Acquisition), recognize that buying from a Boomer is often as much a relationship transaction as a financial one. These owners care deeply about the legacy and people behind their business (Project Wilbur). Take time to understand the owner’s goals and concerns. Are they looking for a full exit, or do they want to stay involved as a consultant for a while? What do they envision for their employees and customers after the sale? Showing genuine interest in the future of the business (not just its profits) can set you apart.
Reassure the owner that you’ll take good care of the business they worked hard to build. For example, emphasize your commitment to maintaining the company’s values, keeping on key employees, and serving the loyal customers with the same dedication. Building this kind of rapport and trust early on will not only make a Boomer more comfortable selling to you, it can also lead them to be more flexible on the terms. Many long-time owners would rather sell to someone they trust for a slightly lower price than get top dollar from a buyer who makes them uneasy. In short, approach a Boomer seller with respect, patience, and empathy – the deal will go much smoother (Project Wilbur).
Bridge the valuation gap with creativity
It’s common to encounter a gap between what a Boomer owner thinks their business is worth and what your analysis says it’s worth. Remember, they’re often factoring in intangibles and “blood, sweat, and tears” value that standard multiples don’t capture. Rather than dismissing their price outright, consider creative deal structures to meet somewhere in the middle.
One useful tool is an “earn-out”, which is a provision where part of the payment is made over time, contingent on the business hitting certain performance targets. For instance, you might pay an initial lump sum based on a 4× EBITDA valuation, and then agree that if the business achieves XYZ revenue growth in the next two years (perhaps reflecting those untapped opportunities the seller believes in), they get an extra payout. This can give the seller confidence that they’ll be rewarded if the business performs as they envisioned, while protecting you from overpaying upfront (Matt White Law PC).
Seller financing is another powerful bridge: many Boomer owners are open to carrying a portion of the price as a promissory note, paid by the business’s future earnings (Reidel Law Firm). Not only does this reduce the cash you need up front, it also signals the owner’s confidence in the business’s continued success under your stewardship. Use this to your advantage, but be sure to structure it within the bounds of any lending you’re using (for example, if using an SBA loan, the seller note may need to be on full standby and not exceed certain amounts). The key for buyers is to stay flexible and problem-solve together with the seller: if the price is a sticking point, negotiate how and when they get paid, not just how much. This collaborative approach can turn an impasse into a win-win deal structure.
Secure your financing and be ready for new SBA rules
In the current market, having your financing lined up is more important than ever. With so many Boomer-owned businesses potentially coming up for sale, buyers who can move quickly and decisively have an edge. If you plan to use an SBA 7(a) loan (a common route for small business acquisitions), be aware of the recent rule changes affecting deal financing. As mentioned, SBA rules now limit how much of the buyer’s required down payment can be covered by a seller note. Only up to 50% of the equity injection, and only if that note is on full standby (Kumo). In plain terms, this means you’ll need more of your own cash (or investor equity) available to close the deal. For example, if a 10% down payment is required, at least 5% must come from you, whereas previously you might have been able to structure most of that as a seller-held note. Prepare accordingly: boost your savings, line up co-investors, or explore alternative financing (such as mezzanine loans or non-SBA lenders) if needed.
Also, get pre-qualified with lenders so you know your borrowing limit and can demonstrate to a seller that you’re financially capable. Being ready with financing not only speeds up the process, it makes you a more credible buyer in the eyes of a Boomer owner who will want assurance that the deal won’t fall apart due to lack of funds.
One more tip: because many retiring owners do end up financing part of the sale, ensure you understand how to structure those arrangements safely. Use attorneys or SBA-savvy lenders to draft terms for any seller note or earn-out so that both parties are protected. When you come to the table with financing solidly in place and a willingness to work within the new guidelines, you make the seller’s decision to choose you that much easier.
Be patient and flexible with the transition
Buying from a Boomer isn’t like buying a used car – you can’t just pay and drive off. These transactions often move more slowly than other business deals, in part because the seller may need time to get comfortable and work through the emotional side of letting go (Project Wilbur). Don’t rush it. If you try to push an owner into a quick closing, it might backfire with them pulling away. Instead, show that you’re willing to work on their timeline to some extent. This might mean agreeing to a longer transition period where the seller stays on for a few months post-sale to train you and introduce you to key clients. Many Boomer sellers appreciate buyers who value their knowledge and want them around as mentors during the handover. It can reassure them that the business will be in good hands. From your perspective as a buyer, such arrangements are invaluable – you get the benefit of decades of experience and a smoother transfer of relationships.
Additionally, be prepared for extensive due diligence and ask a lot of questions kindly. Some long-time owners might not have all documents at their fingertips, so practice patience as they dig up old records or straighten out their financials. Keep communication open and positive, rather than adversarial. If something in diligence uncovers a weakness (say, customer concentration or an outdated process), discuss solutions together rather than simply using it as a price-chipping tool.
Remember, the seller wants to feel that the business they built will continue to thrive. If you demonstrate a long-term vision for the company – for example, plans to invest in growth, uphold their quality standards, and perhaps keep their family name on the door – you’ll alleviate many of their fears.
In summary, flexibility and patience on your part can dramatically increase your odds of securing a great deal amid the silver tsunami. There are tremendous opportunities to buy healthy, established companies from Boomers, but the human element is paramount. Approach these acquisitions with a people-first mindset and you’ll stand out in the best way possible.
What This Means for Sellers
If you’re a Boomer business owner looking ahead to an eventual exit, the slow wave of retirements means competition and opportunity. There will be more sellers on the market each year, but also an unprecedented number of eager buyers ranging from first-time entrepreneurs to private equity firms. To ensure your business finds a good home (and you get the retirement you want), you’ll need to plan carefully and likely do some homework. Here are actionable steps for Boomer sellers and their brokers to navigate this transition:
Plan ahead (far ahead)
The biggest mistake is waiting too long to prepare. Ideally, start grooming your business for sale 2–5 years before you hope to retire (Matt White Law PC). Use that time to address weaknesses and build value. Early planning also gives you the flexibility to time your exit rather than being forced into a sale due to ill health, market downturns, or tactical constraints. And if you’re aiming to pass the business to employees or family, you’ll likely need even more time to train successors or arrange financing.
To guide this process, many owners now partner with a CEPA (Certified Exit Planning Advisor) — a credentialed professional trained specifically in exit planning and value acceleration. CEPAs help owners:
Develop a detailed exit roadmap aligned with personal, financial, and business goals
Perform a “gap analysis” to identify what’s preventing the company from achieving higher multiples
Coordinate tax, legal, financial, and succession advisors into a cohesive strategy
Think through non-obvious risk points (e.g. key-person dependence, customer concentration, governance)
Prepare for the emotional and post-exit adjustments, not just the transaction itself
Because CEPAs follow a methodology (often called the Value Acceleration Methodology®), their guidance is structured and holistic, not piecemeal. In the Exit Planning Institute’s materials, the CEPA credential is positioned as a way to help owners “build value today” and avoid regret later, especially since a majority of business owners entering transitions report wishing they’d started earlier (Exit Planning Institute).
In short: don’t procrastinate**.** As one advisor put it, “Don’t wait until you need to sell your business to start planning to sell your business” (Tennessee Valley Group Inc). Early action can mean the difference between a thriving business that attracts buyers and an unsellable one.
Get a realistic valuation (and check your emotions at the door)
It’s crucial to know what your business is actually worth on the market (Tennessee Valley Group Inc). Too often, owners set an asking price based on what they feel they deserve or what they need for retirement, rather than on market fundamentals. Others are misled by well-meaning but inexperienced brokers who inflate valuations to win the listing. Overpricing is the quickest way to scare off serious buyers, and a business that languishes unsold can actually lose value over time. Engage a professional appraiser or an experienced broker you trust to analyze your financials and recent comparable sales. Be prepared that the number might come back lower than you hoped; this is where you must separate emotion from economics. Don’t be discouraged – instead, use it as a baseline to improve from.
Also, ground your expectations in cash flow, not just future potential. Remember that buyers (especially individuals) are essentially “buying an income.” If your profits can’t support a decent salary for the new owner, that limits what they can pay (Tennessee Valley Group Inc). You might think your company will boom in the next 5 years, but most buyers won’t pay you today for results you haven’t delivered yet (Matt White Law PC). If you truly believe in that upside, be open to alternative deal structures (like an earn-out) rather than insisting on an all-cash price that assumes a rosy future. An honest valuation today is the foundation of a successful exit tomorrow.
Maximize the value drivers
Once you have a handle on your likely valuation, take concrete steps to boost the factors that drive that value. At the end of the day, buyers (and their lenders) pay for consistent profits, well-managed operations, and growth potential. Focus on shoring up your earnings: trim unnecessary expenses, negotiate better supplier deals, or pursue that extra sales growth you’ve been too busy for. Strong profitability year-over-year will make your business a magnet for buyers (Calhoun Companies).
Equally important, work to make your business less dependent on you personally. If everything at your company runs through the owner, that’s a red flag for buyers (they worry the business might fall apart when you leave) (Tennessee Valley Group Inc). Start delegating and training employees to handle key client accounts, critical procedures, and decision-making. Establish clear, documented processes for all aspects of operations, so that someone new can step in and understand how things work. Ideally, your business should be able to operate for a month without your direct involvement and not see a dip in performance. That’s a litmus test for being truly “transferable” to a new owner (Tennessee Valley Group Inc). If you lack a second-in-command, consider hiring or promoting one, even if just to show buyers that there’s leadership in place beyond you.
All these steps will not only increase your business’s valuation multiple, they also widen your pool of potential buyers (because more people will feel capable of taking it over). In a future flooded with sellers, you want your business to stand out as well-run, profitable, and turnkey.
Spruce up your business’s curb appeal
First impressions matter, even in business sales. Just as you’d stage a house for sale, you should present a clean, well-organized company to prospective buyers (Calhoun Companies). Start with your financials: get all your bookkeeping up to date and as detailed as possible. Remove personal expenses from the business accounts (to clearly show true profitability). If you have any messy records or outstanding compliance issues, resolve them. Many seasoned buyers will perform a formal quality of earnings review, so it’s wise to do a mini “audit” yourself beforehand –or hire an accountant to do a sell-side due diligence check. This helps you catch and fix inconsistencies before buyers see them, preserving your credibility and the deal value (RG & Co).
Next, tidy up the physical and digital state of the business. Clean and organize your facilities, whether that’s a storefront, a factory floor, or simply your inventory storage. Address any minor maintenance issues that have lingered. Also ensure you have documentation for all important aspects of the business: employee roles, customer contracts, supplier agreements, SOP manuals, etc. A buyer should come away from a site visit confident that your business is well-run and easily transferable to a new owner (Calhoun Companies). Don’t neglect intangible “appearance” factors too. For example, make sure your online presence (website, reviews, social media) is polished and positive, as buyers will surely google your company.
The goal is to eliminate sources of doubt. Deals often fall apart when a buyer encounters surprises or chaos during due diligence (Tennessee Valley Group Inc). By doing the cleanup work now, you make your business more attractive and the sale process smoother.
Be prepared to compromise and structure deals wisely
Selling a business involves negotiation – you likely won’t get everything you want, exactly how you want it. The most successful sellers enter talks with an open mind and a willingness to give-and-take (Calhoun Companies).
Identify your top priorities (e.g. a certain minimum price to fund retirement, or assurance that the buyer will keep your staff, etc.), but also identify areas you can be flexible on. For example, if the buyer meets your price, maybe you’re willing to stay on an extra six months to help mentor them. Or if a buyer has all the right qualities but can’t meet your full asking price upfront, consider accepting part of it in a seller financing note to be paid over a few years (Tennessee Valley Group Inc). In fact, be ready to finance a portion of the sale in general. Many small-business deals require it, especially if bank financing falls short. Offering, say, 10–20% of the price as a seller note can expand the pool of buyers who can afford your business, and it signals your confidence in its future. Just ensure the terms (interest rate, duration, etc.) are clearly defined, and understand any SBA-related constraints if the buyer is using such a loan.
It’s wise to work with a knowledgeable business broker or transition advisor at this stage. They can help structure a deal that works for both sides that balances price, payout schedule, training periods, non-compete agreements and more. A good broker will also screen buyers so you don’t waste time with window-shoppers or unqualified prospects.
Most importantly, keep emotions in check during negotiations. It’s normal to feel a twinge when a buyer critiques your life’s work or offers less than you hoped. Take a step back and view it objectively or lean on your advisor as a buffer. By staying calm, listening to the buyer’s concerns, and problem-solving together, you can often reach a satisfying agreement even if it’s not exactly the deal you first envisioned (Calhoun Companies). Remember, the end game is not “winning” a negotiation, it’s closing a sale that achieves your core goals and sets the business up for continued success.
From Challenge to Opportunity
The silver tsunami isn’t just about demographics; it’s a slow but profound reshaping of America’s business landscape. Baby Boomer owners are holding on longer than expected, sometimes out of identity and purpose, sometimes because of finances, market timing, or the lack of a clear successor.
For buyers, this moment presents a rare opportunity to step into proven businesses if they can build trust, structure deals creatively, and respect the legacies they’re inheriting. For Boomer sellers, preparation is everything: cleaning up financials, getting realistic on valuation, and being open to flexible deal structures will make all the difference. And for brokers and advisors, the task is to bridge the gap between sentimental owners and pragmatic buyers, guiding both toward outcomes that preserve jobs, wealth, and community stability.
Looking ahead, the wave of transitions over the next decade will test the resilience of local economies, but it also offers a once-in-a-generation chance to transfer not just ownership, but opportunity, to the next generation of entrepreneurs.