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Deal Urgency in Q4: How to Close (or not close) Before Year-End
Show Notes
Thinking about closing in Q4, or setting up a smart January start? Revenue Rocket has led hundreds of IT services deals. If you want a realistic path to close, a risk-based diligence plan, or a sanity check on timelines, let’s talk.
Listen to Shoot the Moon on Apple Podcasts or Spotify.
Buy, sell, or grow your tech-enabled services firm with Revenue Rocket.
EPISODE TRANSCRIPT
00:00 | Mike (Intro)Hello, and welcome to this week’s Shoot the Moon podcast, broadcasting from Revenue Rocket world HQ in Bloomington, Minnesota. With me today are my partners, Ryan Barnett and Matt Lockhart—welcome, guys.
00:16 | MattThanks, Mike. Good to be here—and as the days get shorter, it’s a reminder that 2025 is running out. I saw a preview: our topic ties right into that.
00:42 | RyanAbsolutely. On this show we dive into M&A for tech-services businesses—tactical and strategic. And yes, the days are literally getting shorter. We were just talking about daylight saving—early November is around the corner. We’ve got several deals under LOI. Buyers want to get deals done; sellers too. There are very specific reasons to close this year. So: how do we get deals done with the time that’s left—without cutting corners? It’s mid-October; call it ~75 days. Q4 looks like a dealmaker’s quarter. Mike, what makes Q4 so unique?
02:06 | MikeBuyers want to deploy capital. It’s been a slower year for many, especially financial buyers. The right deals have been harder to find or keep alive through diligence—some have fallen out due to complications. Now, with more clarity on rates and markets, folks want to move. Sellers are motivated too. But with only a couple months to go, we have to manage to the timeline—and all the dependencies that come with it.
03:47 | RyanLevel-setting: if you’re trying to buy or sell today, where do you need to be before admitting that 2025 isn’t your year for a transaction?
04:11 | MattReadiness. Run your business like you’ll never sell it—but be ready enough that you could sell tomorrow. Practically, if you haven’t negotiated and executed an LOI, it’s going to be tough. You need clarity on the critical path for diligence (including QofE), agreement on a project plan, and—remember—holidays will pull attention. If you’re post-LOI, it’s viable to close by year-end. And these axioms apply no matter the quarter: time kills deals, or at least wears people out. Efficient, organized, prepared—that’s the path to close.
06:26 | RyanThis time of year is deadline-driven. Mike, how do those year-end deadlines form in practice?
06:52 | MikeEven in normal times there’s urgency after LOI—but year-end amplifies it. Acquirers want this year’s revenue and profit “on the board.” Sellers weigh tax considerations. Funds face pressure to put capital to work by December 31. We see a flurry in September/October to close by year-end. We typically say ~90 days from LOI to close; it can be ~60 with a solid, properly resourced plan. It takes a village—financial diligence, QofE, legal, advisors. Any swim lane can slip the schedule, so set a weekly cadence with all parties.
10:17 | RyanGreat. What makes a solid plan? Preparation separates fast closers from faders. Matt?
10:45 | MattStart with the early gate: financial review / QofE. It might be full, or risk-based/light, but it validates cash flows through the P&L and balance sheet. Identify “tricky” areas early and get them on the table. Make sure the review team understands your industry. We saw a reputable firm struggle because the team didn’t understand the business. Same with operational and contract reviews—get domain-savvy people. Use a single, agreed project plan with dated stage gates and live conversations—avoid asynchronous ticket-trading. As Mary Poppins said, “Well begun is half done.” Legal can be efficient—or painfully slow—depending on how you prep it.
14:12 | RyanWe’ve talked about risk-based diligence. Mike, how does that help you move at the right speed without missing something material?
14:53 | MikeFirst, sellers need their books in order and must be fully transparent and responsive. If not, you risk a retread—value changes from LOI due to perceived risk. Do pre-diligence with your advisor so numbers tie out and responses are ready. You can’t take two weeks every time someone asks for a data pull. Quick, fulsome responses help buyers assess risk and keep the timeline and valuation intact.
17:05 | RyanHoliday outages are real—Columbus Day, Veterans Day, Thanksgiving, year-end religious holidays, plus travel. Matt, tactics?
17:56 | MattSet stage-gate deadlines with buffer before outages. Don’t have a QofE sign-off due the Wednesday before Thanksgiving—or the week after. Pull it forward to the prior Friday or Monday so there’s space for questions and final check-off. Put the calendar in front of everyone early. It saves your deal—and your holiday.
20:29 | RyanReasons to close before year-end: tax optimization, comp/bonus alignment, capital-deployment pressure, clean financial cutover, momentum. Reasons to slip to after year-end: different tax strategy, holiday fatigue, a clean fresh start. Also, deadlines can backfire—no breathing room for diligence. How do you advise clients: push now or wait?
21:34 | MikeBuyer “must close by 12/31” is often self-imposed—challenge it or align to it. On the sell-side, tax can be decisive (loss carryforwards, credits, etc.). Other times, sellers may prefer January to punt tax liability timing a bit. Health or life events matter too. We always recommend independent tax counsel—we’ve seen lots of strategies, but we’re not your tax advisor. A specialized CPA may find credits or structures you didn’t know about.
24:47 | MattDon’t ignore culture. Excess pressure can sour the relationship, which hurts post-close outcomes. Sometimes the right move is to take a breath and slide into January. And if diligence reveals a material renegotiation, expect a timeline reset.
26:25 | RyanWe recently ran a tight timeline: right resources, worked through discomfort, kept the agreed timeframe—great outcome for both sides. 2025 is fleeting, but there’s still time to get deals done. Final thoughts?
27:24 | MattGreat topic. These principles apply year-round. Also: if you’re thinking about going to market, the end of the year is a great time to prepare and line up an early-year launch.
28:11 | MikeAgree. Use year-end to discuss next-year plans with your chosen advisors, check market timing and valuation, and decide whether to take in capital, recap, or sell. Thanks for listening to Shoot the Moon—we’ll keep unpacking M&A for IT services. Make it a great week!
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By Show Notes
Thinking about closing in Q4, or setting up a smart January start? Revenue Rocket has led hundreds of IT services deals. If you want a realistic path to close, a risk-based diligence plan, or a sanity check on timelines, let’s talk.
Listen to Shoot the Moon on Apple Podcasts or Spotify.
Buy, sell, or grow your tech-enabled services firm with Revenue Rocket.
EPISODE TRANSCRIPT
00:00 | Mike (Intro)Hello, and welcome to this week’s Shoot the Moon podcast, broadcasting from Revenue Rocket world HQ in Bloomington, Minnesota. With me today are my partners, Ryan Barnett and Matt Lockhart—welcome, guys.
00:16 | MattThanks, Mike. Good to be here—and as the days get shorter, it’s a reminder that 2025 is running out. I saw a preview: our topic ties right into that.
00:42 | RyanAbsolutely. On this show we dive into M&A for tech-services businesses—tactical and strategic. And yes, the days are literally getting shorter. We were just talking about daylight saving—early November is around the corner. We’ve got several deals under LOI. Buyers want to get deals done; sellers too. There are very specific reasons to close this year. So: how do we get deals done with the time that’s left—without cutting corners? It’s mid-October; call it ~75 days. Q4 looks like a dealmaker’s quarter. Mike, what makes Q4 so unique?
02:06 | MikeBuyers want to deploy capital. It’s been a slower year for many, especially financial buyers. The right deals have been harder to find or keep alive through diligence—some have fallen out due to complications. Now, with more clarity on rates and markets, folks want to move. Sellers are motivated too. But with only a couple months to go, we have to manage to the timeline—and all the dependencies that come with it.
03:47 | RyanLevel-setting: if you’re trying to buy or sell today, where do you need to be before admitting that 2025 isn’t your year for a transaction?
04:11 | MattReadiness. Run your business like you’ll never sell it—but be ready enough that you could sell tomorrow. Practically, if you haven’t negotiated and executed an LOI, it’s going to be tough. You need clarity on the critical path for diligence (including QofE), agreement on a project plan, and—remember—holidays will pull attention. If you’re post-LOI, it’s viable to close by year-end. And these axioms apply no matter the quarter: time kills deals, or at least wears people out. Efficient, organized, prepared—that’s the path to close.
06:26 | RyanThis time of year is deadline-driven. Mike, how do those year-end deadlines form in practice?
06:52 | MikeEven in normal times there’s urgency after LOI—but year-end amplifies it. Acquirers want this year’s revenue and profit “on the board.” Sellers weigh tax considerations. Funds face pressure to put capital to work by December 31. We see a flurry in September/October to close by year-end. We typically say ~90 days from LOI to close; it can be ~60 with a solid, properly resourced plan. It takes a village—financial diligence, QofE, legal, advisors. Any swim lane can slip the schedule, so set a weekly cadence with all parties.
10:17 | RyanGreat. What makes a solid plan? Preparation separates fast closers from faders. Matt?
10:45 | MattStart with the early gate: financial review / QofE. It might be full, or risk-based/light, but it validates cash flows through the P&L and balance sheet. Identify “tricky” areas early and get them on the table. Make sure the review team understands your industry. We saw a reputable firm struggle because the team didn’t understand the business. Same with operational and contract reviews—get domain-savvy people. Use a single, agreed project plan with dated stage gates and live conversations—avoid asynchronous ticket-trading. As Mary Poppins said, “Well begun is half done.” Legal can be efficient—or painfully slow—depending on how you prep it.
14:12 | RyanWe’ve talked about risk-based diligence. Mike, how does that help you move at the right speed without missing something material?
14:53 | MikeFirst, sellers need their books in order and must be fully transparent and responsive. If not, you risk a retread—value changes from LOI due to perceived risk. Do pre-diligence with your advisor so numbers tie out and responses are ready. You can’t take two weeks every time someone asks for a data pull. Quick, fulsome responses help buyers assess risk and keep the timeline and valuation intact.
17:05 | RyanHoliday outages are real—Columbus Day, Veterans Day, Thanksgiving, year-end religious holidays, plus travel. Matt, tactics?
17:56 | MattSet stage-gate deadlines with buffer before outages. Don’t have a QofE sign-off due the Wednesday before Thanksgiving—or the week after. Pull it forward to the prior Friday or Monday so there’s space for questions and final check-off. Put the calendar in front of everyone early. It saves your deal—and your holiday.
20:29 | RyanReasons to close before year-end: tax optimization, comp/bonus alignment, capital-deployment pressure, clean financial cutover, momentum. Reasons to slip to after year-end: different tax strategy, holiday fatigue, a clean fresh start. Also, deadlines can backfire—no breathing room for diligence. How do you advise clients: push now or wait?
21:34 | MikeBuyer “must close by 12/31” is often self-imposed—challenge it or align to it. On the sell-side, tax can be decisive (loss carryforwards, credits, etc.). Other times, sellers may prefer January to punt tax liability timing a bit. Health or life events matter too. We always recommend independent tax counsel—we’ve seen lots of strategies, but we’re not your tax advisor. A specialized CPA may find credits or structures you didn’t know about.
24:47 | MattDon’t ignore culture. Excess pressure can sour the relationship, which hurts post-close outcomes. Sometimes the right move is to take a breath and slide into January. And if diligence reveals a material renegotiation, expect a timeline reset.
26:25 | RyanWe recently ran a tight timeline: right resources, worked through discomfort, kept the agreed timeframe—great outcome for both sides. 2025 is fleeting, but there’s still time to get deals done. Final thoughts?
27:24 | MattGreat topic. These principles apply year-round. Also: if you’re thinking about going to market, the end of the year is a great time to prepare and line up an early-year launch.
28:11 | MikeAgree. Use year-end to discuss next-year plans with your chosen advisors, check market timing and valuation, and decide whether to take in capital, recap, or sell. Thanks for listening to Shoot the Moon—we’ll keep unpacking M&A for IT services. Make it a great week!