Walking away is part of the process of buying a small business.
You pay for good diligence to challenge what you understand about the business not confirm what you hope to be true.
Here are real stats from the first 5 months of 2025 at Midwest CPA.
35 Quality of Earnings (QoE) engagements (Deal Size $2-15MM EV) in the first five months of 2025.
Closed: 9
Dead: 13
Still in Progress: 13 (we estimate 85% of these will close)
Projected Overall Close Rate: ~60%
We’re seeing roughly 6 in 10 deals make it to the finish line a reminder of how vital solid diligence is when evaluating a business.
Here are strategies to reduce dead deal costs:
1. Learn how to spot initial red flags yourself
2. Phase your QoE
3. Phase your service providers
4. When it's time to kill a deal, don't hesitate
5. Learn from your mistakes