Working for the company prior to acquisition?

January 15, 2026

by a searcher in Sacramento, CA, USA

I am looking to get more information on working in the business or general industry prior to acquisition if you came from a different background. I am considering offering free work to gain experience and try out the industry prior to acquisition to see if it fits me. Was it worth your time to do this?

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Reply by a searcher
from University of Maine (System) in Medford, OR, USA

You are describing an Operator Transition with Pre-Negotiated Buyout, sometimes called: • Operate-to-Own • Management Buy-In with Call Option • Earn-In Acquisition (operator focused, not seller earnout) Core idea: 1. You step into the business as an operating manager or GM. 2. Ownership remains with the seller during the transition. 3. The purchase price and terms are negotiated upfront. 4. You earn the right (or obligation) to acquire the business after defined milestones or time. 5. Financing usually happens at the end, not the beginning. This can be a great way to examine a business, build owner trust, investigate a business with messy books, an off book deal that comes with an unprepared seller, etc. You should be paid a market rate salary to do this. You need to be aware of some SBA gotcha's Common pitfalls to avoid (very important) 1. Control without ownership mismatch If you are accountable but cannot fire, hire, or change pricing, you are exposed. 2. Soft pricing language “Fair market value at the time” is a deal killer later. 3. Seller operational interference Sellers must either run or step back. No hybrid. 4. SBA contamination Side agreements can invalidate financing later. 5. Personal burnout risk You are effectively proving the business twice. The biggest risk is after running it, you will be very emotionally attached to the business and the team. Can you walk away if you find red flags or it doesn't actually meet your filters.

Reply by a searcher
from Western University in Calgary, AB, Canada

I wouldn't value your time as "free", but I think the general idea has merit. I have heard (I forget where) of a structure where the seller gives the searcher the option to purchase the business at a fixed price, and the searcher then works in the business and effectively gets a head start on growing it. The searcher's compensation is the incremental P&L they generate during their time working if they decide to pursue the acquisition, plus the seller gets to keep whatever improvements the searcher has generated if they decide not to exercise the option to purchase.

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