$50 Million M&A Summit Success Story
Helping Business Owners Exit Confidently into Retirement
This case study showcases how one pivotal decision – engaging with our Exit Strategy Maximization solution – transformed a successful manufacturing business owner’s uncertain exit into a dramatically more lucrative and tax-efficient outcome.
The entrepreneur was first introduced to our solution at the 2024 M&A Summit. Since then, he has implemented a customized strategy projected to increase his post=scale cash flow by $27 million.
Prior to taking action, the owner lacked both a structured exit strategy and a plan for managing future tax liabilities. Our solution delivers a strategic framework for both – while also helping mitigate the risks tied to reinvesting proceeds in traditional capital markets.
Thanks to this single strategic move, his overall results are expected to improve by more than $50 million – securing a clear path to greater personal wealth, legacy preservation, and peace of mind.
Entrepreneur Profile
Business
Owner of a fast-growing manufacturing company in Central Wisconsin.
Growth Objective
Primary focused on growth through acquisition – specifically targeting the purchase of a key competitor to reach a $25 million enterprise value within 10 years.
Planning Gap
While deeply focused on building enterprise value, the owner had not yet devolved a strategic exit plan or considered what life would look like after the sale. Lacking clarity on how to structure the transaction for tax efficiency or strategically allocate the proceeds, he left himself vulnerable to external risks – jeopardizing both his long-term wealth and his ability to maintain his lifestyle after the sale.
Challenges
Focused on growth. the client had no clear strategy for eventually exiting his business. After attending the 2024 M&A Summit and engaging with our team, he realized that building enterprise value is only half the equation–unlocking and preserving that value requires proactive, expert planning.
Through our process, we uncovered serveral key risks:
- POST-SCALE CASH FLOW RISK
- Taxes and market volatility could significantly reduce available cash flow after the sale
- CAPITAL GAINS EXPOSURE
- A future sale, if left unplanned, would result in significant tax erosion
- MARKET CONCENTRATION
- Most of his personal wealth is tied up in the business, resulting in minimal diversification and liquidity
- UNINSURED LIFE RISK
- No financial protection in place for his spouce or business in the event of his untimely death
Exit Strategy Maximization
The core objective of our plan was to maximize post-scale cash flow – and it delivered to the tune of $27 million more than a traditional exit.
At the heart of this success was one simple yet powerful decision: pre-funding an account today, which laid the foundation for the entire strategy’s effectiveness down the road.
Not only is the client forecasted to receive significantly more in post-scale cash flow using this strategic approach, but they are also benefiting from a plan that reduces other external risks in retirement.
How the Plan Works
The client’s plan follows a proven formula for owners planning for a large future liquidity event
Establish the account in advance
Business owners set up an optimized life insurance policy years before selling their business. The more lead time and funding allocated to the account pre-sale, the greater the owner can benefit from its future use.
Deposit sale proceeds strategically
When the business is sold, a portion of the proceeds are deposited directly into the life insurance policy. This allows the funds to grow within a uniquely tax-advantaged account, unmated in its ability to accept large deposits. The policy uses indexing strategies to capture positive market appreciation while protecting against direct losses in the underlying strategies.
Utilize tax-financing strategies
The plan employs an income tax-financing technique that enables the owner to mange the gross value of the sale proceeds. This approach enables the owner to earn returns on the full, pre-tax account value rather than being limited to what remains after taxes. This maximizes long-term policy values, and distributions.
Access funds tax-free for life
The owner can borrow against the policy income tax-free throughout their lifetime, while the full account value continues to grow. The account remains highly liquid and readily accessible, offering flexibility for future needs.
Enhance legacy with death benefit
At death, any remaining life insurance net of policy loans is paid out income tax-free to the designated beneficiaries. This preserves family weath while also supporting broader legacy goals, including charitable giving or multi-generational planning.
Quantifiable Results
Thanks to our custom-built strategy, the client achieved the following measurable outcomes:
- $27 million increase in projected post-sale cash flow
- Overall improvement in results exceeding $50 million
- Significant reduction in post-sale exposure to external risks
- Solution established to address future capital gains taxes
Conclusion
Strategic Planning That Pays – No Matter the Exit Path
This case study illustrates the transformation impact of intentional, strategic planning.
After attending the 2024 M&A Summit, the client partnered with OPTIMUS to implement a plan that not only positioned him for tax-optimized, high-value exit – but also improved his total outcome by more than $50 million.
But this strategy isn’t just for business owners eyeing a $25 million exit. The OPTIMUS Exit Strategy Maximization process is highly customizable and can be scaled to suit business owners with more modest exit targets as well.
Whether you’re planning to sell for $3 million or $30 million, the principles of early planning, tax efficiancy, risk reduction, and legacy preservation apply equally.
Additionally, for families who choose to keep the business in family rather than sell, OPTIMUS offers alternative succession and legacy strategies that:
- Facilitate smooth generational transfers
- Protect family harmony and ownership control
- Optimize estate and income tax implications
- Align weath transfers with family values and long-term goals
In every case, our mission is the sameL to help business owners confidently transition their life’s work into lasting weath, family security, and meaningful legacy.