Five Strategies to Protect Confidentiality When Selling a Business


When you are ready to sell your business there are so many factors that need to be taken into consideration, and sometimes that can be overwhelming if you’ve never done it before. That’s why at Sigma, we have worked hard to think through every aspect of selling a business and how that affects you.

In this article, we’re gonna talk about five strategies to protect confidentiality when selling a business. Some of the points may actually seem counterproductive, or as I might say, “counter confidential”, but in the long run, it’s actually more secure way of selling your business.

Why is Confidentiality Important When Selling a Business?

After selling businesses for over 20 years, we still find business owners that do not understand the importance of confidentiality when selling a business. Many business owners think that it doesn’t matter. They want to sell the business, and think it’s just a business transaction and it doesn’t matter. Over 20 years of selling businesses, we’ve had business owners tell their employees they’re wanting to sell their business. And those very employees go out and find another job. When employees leave, it lowers value. Customers leaving also drives value down.

Confidentially When Selling a Business Increases the Value of Your Company

Maintaining confidentiality when you sell a business is paramount to the process. These five strategies to maintain confidentiality will positively help your bottom line.

1. NDA or Confidentiality Agreement

What is the NDA or non-disclosure? Legally, you’re binding them to keep the information confidential, but if you have a non-ethical buyer, you don’t even care if they sign a non-disclosure. You still don’t want them to have information when you’re selling your business. To maintain confidentiality, you must have a non-disclosure signed and the person that’s signing the non-disclosure, their information verified.

Having an NDA sign for every single buyer that comes in is very important, and not just having them sign an NDA and you have no idea who they are, there is software that they can actually verify the identity of the prospective buyers.

    • Is it somebody that you should even consider doing businesses with?
    • Do they have a felony?
    • Is it a competitor or is it your employee?

2. Confidential Contact to Maintain Confidentiality When Selling a Business

To protect confidentiality, make sure when you are communicating with prospective buyers, business brokers, legal and financial advisors about the sale that they are using a secure and private email, mobile phone etc. Please DO NOT use the company’s main information like the main phone line or main email address. Set up a free Gmail account and give out a personal mobile line. Make sure that you don’t have employees that are checking your email. Have a private email to protect your confidentiality. Many business owners give out an email that their assistant has access to, and then they don’t even think about it. They go and sell their business and they realize, well, their assistant’s known the whole time that the business is for sale.

3. Confidential C.I.M. and Video Interview

When selling a business prospective buyers want to get some information about the business. If you want to sell your business confidentiality then it is important to have CIM and a Video Interview that can be selectively provided to select business buyers.

  • What is a CIM? For companies selling their business a Confidential Information Memorandum (CIM) is a marketing document that provides prospective buyers with a detailed first impression of your business before they would meet the business owner in person. This selling memorandum features an in-depth description of the business and its operations and will also detail both historical and projected financial information of the company.


  • What is a video interview? For companies selling their business a Confidential Video Interview (CVI) is a marketing video that provides prospective buyers with a detailed first impression of your business before they would meet you in person. This selling memorandum features an in-depth description of the business and its operations and will also detail both historical and projected financial information of the company.


    • How does that maintain confidentiality? There are thousands of prospective buyers looking to buy a business in Dallas, Texas. And on average, when a business goes on market, there are 80 to 90 non-disclosures signed on every single business. It’s hard to maintaining confidentiality, you can’t all of a sudden have an influx of 80 to 90 people to talk to during your business day.


    • Why a video? It’s more engaging. People can look in your eyes on that video and understand when you’re saying why you’re selling the business. A qualified business broker will properly vet a prospective buyer making sure they’re qualified.

4. Bringing your CPA, CFO & Bookkeeper Into The Loop

While it is counter intuitive to bring people into the look it is actually going to help you PROTECT confidentiality.

  • CPA – If your CPA is very involved in the, in the financial operations of the business, bring them into the loop. Let them know this is confidential. They’re typically not talking to your employees. They’re typically not talking to your customers. And so if they are talking to somebody in-house, you just talked to them about how this is important, that it stays confidential if you have a bookkeeper. CPA’s are accustomed to keeping things confidential because they have financial data that they can’t go out and spread to everyone.


  • CFO and/or Bookkeeper – When you are going to sell your business the prospective buyers are going to need to understand the financial aspects of the business. There is no escaping it. If you have a CFO, bookkeeper or someone else that helps you with the day to day financials it is important to bring them into the selling process.

Conclusion about Confidentiality When Selling a Business

The importance of selling a business confidentiality is paramount. Take these strategies to protect your confidentiality and protect your equity in your business. Losing confidentiality hinders your ability to sell. Qualified buyers expect to buy a business that have quality employees and customers.

Scot Cockroft Business Broker
Hi, I’m Scot Cockroft.

When I founded Sigma Mergers and Acquisitions back in 2003, I had sold my business the year prior.

Now, that can sound good, but let me tell you, back in 2003, it was not easy to sell a business. Not that I’m saying in modern day times it’s easy to sell a business, but back then I interviewed broker after broker after broker, and no one was interested in actually seeing the value that my business brought to the table.


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Sigma is a the leading business broker in with Corporate offices in Dallas/Fort Worth with roots from 1984. Over 600 businesses sold in Dallas, Fort Worth, Texas, Oklahoma and across the South. Sigma provides full business brokerage services with NO upfront fees. We provide Market approach business valuations for business sales. Sigma is passionate about helping business owners achieve their goal of financial security. Contact us today for a free no obligation business valuation. We are here to help you achieve your goals.

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