Fact-finding is the foundation of the exit planning process. It’s where advisors gather essential information that will ultimately help increase the business's value and marketability.

To illuminate this requisite step in the exit planning process, ELLA, a digital exit planning workbench, highlights exactly what fact-finding is, how exit teams can use the information it provides, and how we empower advisors with AI-augmented fact-finding tools.

The Fundamentals of Fact-Finding

Fact-finding is the process of gathering critical information about a business. Think of it like the "discovery" phase in a court case—a term some advisors use interchangeably with fact-finding.

In legal discovery, both sides gather evidence, exchange documents, and depose key witnesses to build a clearer picture of the case. Similarly, in exit planning, fact-finding involves collecting financials, reviewing governance documents, and speaking with stakeholders to learn about the business's market position. But fundamentally, the goal is the same in both fact-finding and discovery: to reduce surprises, surface the facts, and build a case, only this time, for a stronger, more valuable business.

Proper fact-finding can help estimate a business's value, determine an owner's readiness to sell, and provide a roadmap for decision-making. To achieve a holistic overview of an organization, advisors will often ask business owners to:

• Provide documents:

  • Financial (Personal & Professional)

  • Governance

  • Legal

  • Operational

• Outline personal/professional goals

• Estimate the current fair market value of their business

• Address tax and legal considerations

• Answer a variety of goal-oriented questions

The depth and detail of fact-finding depend on the advisor’s preferred process, the business owner’s readiness, and the industry/sector of the business. At ELLA, we provide tools that adapt to advisors' unique approach to fact finding and how they work with clients.

Why Fact-Finding Matters

Starting the exit planning process with fact-finding is essential as it grounds the entire business strategy in facts rather than assumptions. Otherwise, exit teams risk building plans on unstable ground without clearly understanding the business's finances and operations, as well as the owner's personal finances and goals.

In essence, a structured fact-finding process reveals what's working, what's not, and what's missing. It also helps align the owner's personal finance goals with the business's current value (value gap).

Advisors can also assign different levels of positive and negative impact to the information gathered during fact-finding, to help assess the business's overall strength and risk profile. For example, consistent financials, recurring revenue, and documented systems are positive indicators that move a company toward the "best-in-class" value and marketability. On the other hand, owner dependency, legal issues, and a small market share can be red flags. Using the data from fact-finding, an advisor will be better able to evaluate where the business falls relative to its industry peers and prioritize value-building initiatives accordingly.

Perhaps most importantly, fact-finding empowers the advisor to craft a tailored exit strategy that enhances the company's valuation and closes the owner's value gap. The insights gathered early on inform everything from tax planning and deal structuring to leadership transition and growth acceleration. Moreover, strong documentation and goal alignment reduce buyer friction and increase credibility in the marketplace. By uncovering and addressing gaps proactively, fact-finding becomes the catalyst for building a more resilient, transferable, and valuable business.

Who Benefits from Fact-Finding?

Advisors, both new and seasoned CEPAs, gain tremendous clarity and credibility from a structured fact-finding process. For newer advisors, it creates a framework to follow and removes the guesswork from early client conversations.

For experienced CEPAs, fact-finding is the foundation for applying the Value Acceleration Methodology™ with precision and confidence. It ensures that no stone is left unturned, helping advisors uncover value gaps, anticipate roadblocks, and build exit strategies rooted in the owner's reality, not assumptions. It also gives advisors a straightforward way to educate the client, strengthen trust, and demonstrate leadership from the beginning of the engagement.

Business owners benefit because fact-finding creates clarity—something most have had little time to pursue while working "in" the business. This process helps them take a step back, often for the first time, and look at their business as a transferable asset. It brings visibility to potential risks, unpacks the personal goals that will shape the exit, and reveals how close they are from the financial future they envision. With the proper guidance, fact-finding shifts from a one-time data request to an empowering experience that connects personal values to business value.

The broader exit planning team also thrives when advisors prioritize fact-finding early in the exit process. For instance, CPAs can access accurate financials and tax details, attorneys can spot risks in governance documents and contracts, and CVAs rely on clean data to provide a defensible business valuation.

When the facts are organized and available, the entire team can collaborate more effectively—each professional aligned to the same vision, speaking the same language, and driving toward the same result: a successful, well-orchestrated exit.

Start Fact-Finding Early

The best time for a business owner to begin the fact-finding process is long before they intend to exit. Ideally, they give themselves three to five years of runway.

This timeframe also gives advisors and owners enough time to address value gaps, strengthen weak areas, and build a more attractive and transferable business. Waiting until a triggering event, such as burnout or health issues, often leads to rushed decisions, lower valuations, and missed opportunities.

It’s important to note that early-stage fact-finding isn't just about committing to a sale; rather, it's about positioning the business for better exit opportunities and giving the owner more control over timing, terms, and outcomes.

That said, it's never too late to start. Even if the owner wants to exit in the next 12–18 months, a well-structured fact-finding phase can still help identify deal-breakers early and guide the exit team toward a more successful sale. Whether the exit is years away or on the near horizon, beginning with fact-finding gives the advisor the clarity needed to build a path that aligns with the owner's goals and maximizes the value of their life's work.

Laying a Strong Foundation

Fact-finding should begin with a thoughtful, open-ended conversation between the advisor and business owner. Rather than diving straight into document requests or spreadsheets, some of the most valuable insights often surface through discussion, especially when the owner is encouraged to reflect on their motivations, concerns, and goals.

This dialogue helps uncover intangibles that can’t be reflected in financial documents. Active listening and perceptive questions from an advisor can reveal critical details about leadership gaps, risk areas, and the owner's emotional drivers, laying the foundation for a more personalized and effective exit strategy.

To help guide this process and ensure exit teams don't overlook key areas, ELLA offers an AI-augmented fact-finding tool that prompts advisors with relevant follow-up questions based on the owner's responses. This tool helps advisors and owners stay on track, uncover hidden risks, and document the conversation efficiently and actionably.

As advisors gather information, ELLA begins building a fact-finding deliverable highlighting weighted positive and negative impacts, whether it's a strong customer base or a lack of documented SOPs. The result is a clear, data-informed roadmap that advisors can use to prioritize value-building efforts and increase the company's transferability and market appeal.

Streamline Your Fact-Finding Process

We’re building ELLA's AI-augmented fact-finding tool for advisors looking to streamline their discovery process, strengthen client relationships, and make more effective exit strategies. Designed hand-in-hand with CEPAs and trusted advisors, our platform helps you ask better questions, uncover deeper insights, and generate a clear, actionable deliverable that confidently moves the exit process forward. Reach out today to learn more or request early access to ELLA's fact-finding tool and see how it can elevate your advisory practice from the first conversation.