Your key employees already know your firm’s culture, clients, and project workflows intimately. With today’s SBA financing environment and modern deal structures, they can become owners while you receive near 100% cash at closing, securing your retirement and preserving your legacy.
Market volatility and rising interest rates mean disciplined 5 to 7 year succession planning is more important than ever. By grooming leadership, enhancing financial transparency, and aligning contracts to modern recurring revenue models, you can maximize your firm’s value and ensure a smooth ownership transition.
This updated roadmap refreshes the Step-Up Legacy Plan™ framework with current SBA loan conditions, earnout and rollover deal structures, and recent tax considerations, empowering A/E/LS firm owners to plan with confidence.
Plan early, leverage SBA financing, and empower your employees to own your firm with full payment at closing.
Succession planning for architecture, engineering, and land surveying firms has evolved significantly due to fluctuating SBA loan conditions and changing buyer expectations. The new financing environment (2023–2025) demands strategic preparation to secure maximum sale proceeds, expedite liquidity, and preserve your firm's culture.
Five to Seven Year Roadmap Highlights:
The Step-Up Legacy Plan™ harnesses this financing landscape to enable sellers to receive near 100% cash at closing, eliminating seller carrybacks and personal guarantees. This plan is a pragmatic alternative to costly ESOPs, which often carry >$150K in setup fees plus ongoing trustee costs.
Modern deal structures combine upfront cash payment with earnouts, minority rollover equity, and seller standby notes carefully balanced to meet both seller liquidity needs and buyer financing feasibility. Earnouts today emphasize "reasonable efforts" from buyers rather than strict performance covenants, aligning interests during transition periods.
Employee buyouts supported by the Step-Up Plan preserve firm culture and protect client relationships in an environment where private equity interest and consolidation pressures are increasing. The plan’s flexibility accommodates hybrid and remote staffing models, which are prevalent in 2025.
With disciplined planning and trusted SBA lenders, employee ownership with full payment at closing is more accessible than ever.
Beyond financing, legacy preservation and tax planning remain critical. The estate tax exemption is scheduled to decrease from $13.99M in 2025 to approximately $7M in 2026, significantly impacting succession outcomes. Proactive estate and buy-sell agreement structuring help business owners optimize wealth transfer and reduce tax liabilities.
Several practical steps safeguard your legacy:
Coupled with the Step-Up Legacy Plan™, this planning assures your firm’s culture endures and maximizes financial security.
In summary, successful succession in today’s turbulent market demands a holistic approach: disciplined leadership grooming, financial transparency embracing modern digital workflows, early bank engagement adapting to tightened SBA rules and rates, innovative deal structures balancing cash at closing with contingencies, and sophisticated tax and estate planning.
Starting your 5 to 7 year roadmap today positions you to preserve legacy, maximize value, and achieve near-full liquidity at closing—empowering both you and your trusted employee owners.
Your A/E/LS firm’s future is valuable, and your legacy deserves protection through a well-structured succession plan. With the Step-Up Legacy Plan™, you can exit on your terms, receive cash at closing, and empower your employees to lead.
Planning 5 to 7 years ahead maximizes your firm’s value and financing options, reducing risk and ensuring continuity. Reach out to Allen Business Advisors to explore how this proven strategy can work for your unique firm and situation.
Secure your legacy while unlocking full payment—your succession journey starts now.
