A CPG Founder Asks: Should I Sell My Business — or Grow It Through Acquisitions?

A founder of a profitable e-commerce company in the health products sector recently spoke with Axial about a dilemma that many operators eventually face:

Should I sell the company now, or double down and scale it through acquisitions?

The business has more than two decades of operating history, a strong reputation in its category, and steady profitability. But the owner no longer has the time to actively manage it and is weighing two strategic paths: exiting the company or expanding it through strategic acquisitions.

Below is an anonymized recap of that conversation, organized around the key themes that emerged.

About the Owner

This conversation was with the founder of a profitable e-commerce company in the health products category.

Owner Snapshot

What We Asked (and How He Answered)

Early in the conversation, we focused on understanding three things:

1. Why the owner was exploring a transaction
2. Whether he was leaning toward selling or scaling
3. What financial expectations he had going into the process

Why explore a sale now?

The owner explained that the business originally began as a side project. Over time it grew into a stable and profitable operation with an established supply chain, team, and customer base.

However, he no longer has the time to focus on it.

From his perspective, the decision now comes down to opportunity cost. If he cannot devote significant attention to the company, selling the business may allow him to redirect capital and time elsewhere.

At the same time, because the business is stable and requires relatively little weekly oversight, he is not under pressure to exit quickly.

Sell or scale?

What made this conversation interesting is that the owner is actively considering two opposite strategic paths.

He explained the situation clearly:

• If the business can command a strong valuation, he is open to selling.
• If the valuation does not justify an exit, he may instead acquire additional businesses and scale the platform.

His reasoning was straightforward. If the capital from a sale would simply sit in conservative investments earning modest returns, then selling might not make sense compared to continuing to operate the company.

In other words, he views the business itself as a productive financial asset, and wants to compare its returns to what the sale proceeds would generate elsewhere.

Valuation expectations

At the time of the conversation, the owner was still working through a fresh internal valuation.

He typically performs a valuation exercise every couple of years to maintain a general understanding of the company’s market value.

His early expectation was that the business could potentially trade in the 3.5x to 5x EBITDA range, though he was still refining EBITDA adjustments and add-backs to arrive at a more precise figure.

Transaction Objective Profile

What He Asked (and How We Answered)

Once we understood his situation, the owner shifted the conversation toward how Axial works and how the M&A process might help him evaluate both paths.

What kind of advisors does Axial work with?

He asked whether the advisors in Axial’s network were large investment banks or smaller firms.

We explained that most of the advisors we introduce are boutique investment banks and regional M&A advisory firms that specialize in the lower middle market — typically businesses with $1M to $25M in EBITDA.

These firms operate somewhat similarly to larger investment banks, but focus on founder-owned companies in this size range.

This distinction matters because large global banks generally focus on transactions that are much larger in scale.

How does the introduction process work?

We explained that Axial uses a combination of marketplace data and advisor relationships to identify the best potential advisors for a given business.

Using the information owners share about their company, Axial’s team reviews historical deal data and advisor activity to identify firms that have successfully represented similar companies.

Owners are then introduced to a shortlist — typically three to five advisors — along with supporting information on why each firm may be a strong fit.

What does this cost the owner?

The owner asked directly about fees.

We clarified that Axial’s introduction service is free to business owners. If an owner hires an advisor introduced through Axial, Axial receives a referral fee from that advisor rather than charging the owner directly.

Could advisors also help with acquisitions?

Because the owner is considering scaling through acquisitions instead of selling, he also asked whether advisors could help identify acquisition opportunities.

We explained that while some advisors may also support buy-side mandates, Axial also operates a marketplace where buyers can source relevant acquisition opportunities, and that about half of all M&A deals in North America are marketed via the platform annually.

Unlike listing sites where buyers must manually search through hundreds of companies, Axial’s workflow is more tailored. Buyers can define their acquisition criteria, and relevant opportunities are shared privately by advisors representing relevant businesses.

Where We Coached

Several parts of the conversation involved helping the owner understand how the lower middle market M&A ecosystem actually works.

1. The role of specialized M&A advisors

The owner had relationships with large financial institutions and initially wondered whether they could assist with the transaction.

We clarified that while large banks may provide occasional guidance, they typically focus on transactions that are significantly larger.

For businesses in the lower middle market, specialized advisory firms are often a better fit because they have:

• Deeper buyer networks at this size range
• More experience with founder-owned companies
• More hands-on involvement in the transaction process

2. How advisor selection works

The owner asked how he would know which advisor to choose.

We explained that Axial’s role is not just to make introductions but also to help owners evaluate those options. After presenting a shortlist of advisors, Axial walks owners through each firm’s experience, reputation, and relevant transactions to help guide the selection process.

3. Confidentiality and anonymization

The owner also raised an important concern: if a description of the business is shared too openly, buyers could potentially reverse-engineer the identity of the company.

We explained how anonymized deal summaries are typically written to reduce the risk of identification — for example, by broadening industry descriptions and avoiding language that could directly link to a specific company.

Maintaining confidentiality during the early stages of the process is a core part of protecting the business.

4. How buy-side deal sourcing works

The owner had previously explored acquisition platforms where buyers must search through long lists of companies and sign NDAs to access additional information.

We explained that Axial’s workflow operates differently. Buyers submit their acquisition criteria, and advisors representing relevant businesses can choose to share opportunities privately if they match the buyer’s profile.

This approach tends to create more targeted deal flow.

Conversation Outcome

After this conversation, the owner used several inputs to evaluate whether now was the right time to pursue a transaction.

First, he ran the business through Axial’s valuation calculator to establish an initial benchmark. 

Then, after we introduced him to several M&A advisors, he held conversations with those advisors to understand how buyers would likely evaluate the business in today’s market.

The combination of those perspectives helped him triangulate a realistic valuation range.

While the feedback confirmed that the business was healthy and attractive, the likely valuation did not yet reach the level the owner was targeting.

Instead of rushing into a process, he made a different decision.

The owner chose to delay a sale for roughly one to two years and focus on improving the company’s financial profile — particularly through strategic acquisitions that could increase EBITDA and expand the overall platform.

Based on his objectives and valuation results, his Axial Consultant encouraged this decision as well.

– – – 

In many cases, owners assume that once they begin speaking with advisors the only logical outcome is launching a sale process. In reality, the goal of these early conversations is simply to give owners better information.

Sometimes the right move is to move forward with a transaction. Other times, the better move is to wait.

In this case, waiting created the potential for a stronger outcome later on.

What This Conversation Reveals

Several patterns emerged from this conversation that are common among experienced founders exploring M&A.

Many owners evaluate selling through a return-on-capital lens

Rather than thinking purely about lifestyle or retirement, this owner approached the decision analytically. His question was essentially:

Does selling produce a better financial outcome than continuing to own the asset?

This mindset is especially common among entrepreneurs who view their businesses as investment vehicles rather than purely personal ventures.

Owners often weigh selling against acquisitions

In some cases, the real alternative to selling is not doing nothing — it is doubling down on growth.

For this owner, acquisitions represent another way to unlock value if the current platform remains attractive.

The lower middle market has its own advisory ecosystem

Many founders initially assume that large investment banks are the default option for M&A transactions. In reality, the lower middle market operates through a vast network of specialized advisory firms that focus exclusively on founder-owned companies in this size range.

Understanding that ecosystem can dramatically expand an owner’s options.

Final Takeaway

This conversation highlights an important truth about the early stages of exploring a transaction.

The owner’s first question was not “How quickly can I sell?”

Instead, it was:

“Does selling actually make more financial sense than continuing to own the business?”

That kind of strategic framing often leads to better decisions. By speaking with advisors and understanding market expectations, owners can compare their options more clearly and choose the path that best fits their goals.

Sometimes that leads to a sale. Other times, it leads to a renewed focus on growth.

Either outcome begins with asking the right questions and having the right conversations with the right people.

Thinking About Selling Your Business?

Axial helps business owners explore their options and meet M&A advisors who specialize in their size, industry, and transaction goals.

For founders who want to better understand their company’s potential value — or evaluate whether selling is the right move — the first step is often just a conversation.

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• Speak to an Axial exit consultant
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