10/15/2026
In 30+ years of brokerage, I’ve seen earnouts go very well, and I’ve seen them create serious problems.
The difference almost always comes down to two things: how the earnout is structured in the purchase agreement, and how well the seller understood what they were agreeing to before they signed.
Once the deal closes, you no longer control the decisions that determine whether you hit those targets. The buyer is. That’s a reality every seller needs to sit with before accepting an earnout as part of their deal.
We covered how earnouts work, when they make sense, and what sellers need to negotiate upfront on the BGI blog. If a transaction is on your horizon, this one is worth your time.
An earnout can help close the gap between what a buyer wants to pay and what a seller believes their business is worth. Here's how earnouts work, when they make sense, and what to watch out for.
