The Ultimate MBI Guide: 30 Essential Questions for Prospective Business Buyers

Are you considering buying a company and taking over as the new managing director? A Management Buy-In (MBI) is one of the most exciting but also complex forms of business acquisition. Unlike a Management Buy-Out (MBO), you as an external executive step into an unfamiliar company—a challenge that requires thorough preparation.

This guide will help you ask the right questions before taking the first step. From personal suitability and financing to legal aspects—you will find all the essential considerations that should be at the forefront at the start of your MBI project.

Personal Suitability and Preparation

Am I personally ready to lead a company?

The most important question of all: Are you mentally and personally prepared for the challenge of running a business? An MBI involves not only financial responsibility but also leading employees, making strategic decisions under uncertainty, and often working 60+ hour weeks. Honestly reflect on your resilience, decisiveness, and leadership experience.

Do I have the necessary leadership and industry knowledge?

Successful MBI candidates usually bring years of leadership experience and solid industry expertise. Ask yourself: In which areas are you an expert? Where have you already led teams? What successes can you demonstrate? Investors and sellers will scrutinize these competencies closely.

Which industries are suitable for me?

Focus on industries where you already have experience or that fascinate you. B2B services, manufacturing companies, trade, or technology—each sector has its own characteristics. Your industry knowledge is often crucial for the success of the acquisition.

Defining the Target Company

Do I prefer a specific company size?

Company size significantly determines complexity and financing needs. A business with €2–5 million in revenue requires different skills than a €20 million company. Define your preferred size range based on your experience and financial capabilities.

Which regions or locations are suitable for me?

Location is more than geography—it involves lifestyle, family, and operational proximity to the business. Are you willing to relocate? Can you manage a company remotely? Which regional markets do you already know? These factors influence both the company search and later success.

What motivates me to buy?

Clarify your motivation: Is it primarily financial return, personal fulfillment, or strategic goals? This clarity helps in selecting target companies and during negotiations. Investors also appreciate authentic, well-thought-out motivations.

Financing and Capital

How much equity can I realistically contribute?

Be honest when calculating your equity: liquidity, real estate values, securities minus liabilities, and a safety buffer for personal living expenses. Banks typically expect 15–30% equity of the purchase price. The more you can contribute, the better terms you will receive.

What financing options are available to me?

Besides classic bank loans, there are mezzanine financing, business angels, private equity, and public funding programs. Each financing form has advantages and disadvantages. Inform yourself early about regional development banks and specialized MBI financiers.

Am I prepared to provide personal guarantees for loans?

Most MBI financings require personal guarantees. This means your private assets are at risk. Carefully consider what liability amounts you can bear without endangering your family. Often, liabilities can be limited in time or amount.

Process and Timeline

How much time am I willing to invest in the acquisition process?

A typical MBI process takes 6–18 months—sometimes longer. Expect intensive searching, due diligence, negotiations, and financing rounds. Plan this time realistically and communicate with your current employer if necessary.

How do I find suitable acquisition targets?

Taking multiple approaches is key: company exchanges, M&A advisors, tax advisor networks, industry contacts, and your own research. Build a system to continuously monitor the market. Many of the best opportunities are never publicly advertised.

How reliable are the offers on company exchanges?

Online exchanges offer reach, but quality varies greatly. Pay attention to detailed exposés, realistic valuations, and professional presentations. Reputable sellers usually have a structured sales process. Don’t be misled by exaggerated profit forecasts.

Valuation and Risks

How do I recognize if a company is realistically valued?

Comparable transactions, income approach, and asset value are the basics. Typical multiples vary by industry between 3–8x EBITDA. Be skeptical of valuations above the industry average without identifiable value drivers. A second opinion from an auditor is usually advisable.

How do I assess the risks of an acquisition?

Systematic risk analysis is crucial: market risks, customer concentration, dependencies, compliance risks, and legacy issues. Create a risk list with probabilities and financial impacts. Include worst-case scenarios in your financial planning.

Acquisition and Integration

What role does the current owner play after the purchase?

Clarify early: complete exit or transition period? Advisory role or operational involvement? Cooperation with the previous owner can be invaluable—or a source of conflict. Define roles, compensation, and exit timing in writing.

Is there a structured handover plan?

A professional handover plan includes customer contacts, supplier relationships, internal processes, and key personnel. Plan at least 3–6 months of intensive onboarding. The more complex the business, the longer the transition phase should be.

Market and Business Model

What is the current market and competitive situation?

Analyze market size, growth, competitive intensity, and industry trends. Shrinking markets are not automatically bad—consolidation opportunities often arise. It is important that you understand market dynamics and see strategic options.

Is the business model future-proof?

Digitalization, demographic change, and sustainability are fundamentally transforming many industries. Check: Is the business model resilient? What adjustments are necessary? Where are opportunities for development? A good MBI target has potential for improvements.

How dependent is the company on individual customers or suppliers?

Concentration risks are dangerous: if one customer accounts for over 20% of revenue or a supplier alone provides critical components, dependencies arise. Assess these risks realistically and develop diversification strategies.

Legal and Tax Aspects

What legal risks exist?

Due diligence reveals legal risks: pending litigation, problematic contracts, compliance violations, or environmental liabilities. Work with specialized lawyers. Many risks can be mitigated through warranties, insurance, or purchase price adjustments.

What tax aspects must I consider?

Asset deal vs. share deal, loss carryforwards, tax depreciation, and personal tax consequences—the tax structuring is complex and significantly affects profitability. Obtain tax advice early, ideally from M&A-experienced tax consultants.

Team and Culture

What is the company culture like, and does it fit me?

Culture often determines success or failure. Observe during company visits: How do employees communicate? How are decisions made? Is the atmosphere open or hierarchical? Your leadership philosophy should fit the existing culture or you must be ready to develop it.

How stable is the current management and employee team?

Key personnel are often critical to company success. Analyze: Who are the most important employees? How loyal are they to the company? What resignation risks exist after the acquisition? Plan retention measures for critical positions.

Strategy and Development

What investments will be necessary in the coming years?

Investment needs are often underestimated in MBIs: IT modernization, machinery upgrades, building renovations, or market expansion. Create a realistic 5-year investment plan. These costs must be factored into financing.

How can the purchase price be financed and amortized?

Calculate different scenarios: optimistic, realistic, and pessimistic. When will the purchase price be amortized through profit distributions? How will the company value develop? A solid financial plan demonstrates feasibility to you and investors.

How do I plan to integrate my ideas and strategies?

Develop a 100-day plan for the first steps after acquisition. What quick wins are possible? Where do you see improvement potential? Communicate your vision early and transparently but avoid overly radical changes in the initial phase.

Exit and Future Planning

What is my personal exit strategy?

Paradoxically, think about your exit before the purchase. Strategic sale, family succession, or management buy-out—different options require different preparations. A well-thought-out exit plan often increases company value during your leadership.

Advice and Network

Do I have a network of advisors?

An MBI is hardly achievable without experienced advisors. You need: M&A lawyer, tax advisor, auditor, financing expert, and ideally an experienced M&A consultant. Invest in quality—good advice pays off many times over.

How do I handle the emotional strain of an acquisition?

An MBI is emotionally extremely demanding: uncertainty, time pressure, financial risks, and existential fears. Build a support network—family, friends, coach, or mentors. Many successful entrepreneurs report that emotional coping is underestimated.

What is my plan B if the acquisition fails?

Not every MBI attempt succeeds. Do you have a plan B: returning to employment, a new acquisition attempt, or alternative self-employment? This clarity reduces pressure and enables more relaxed negotiations.

Conclusion: Your Path to a Successful MBI

A Management Buy-In is one of the most exciting paths to entrepreneurial independence. The 30 questions in this guide help you systematically assess whether you are ready for this challenge and how to optimally prepare your MBI project.

The key is: Take your time for preparation. A rushed purchase often has consequences for years. Invest in professional advice and build a strong network. With the right preparation and realistic assessment of your possibilities, nothing stands in the way of your successful Management Buy-In.

Next Steps: Start with an honest self-assessment based on the first five questions. Then gradually develop your MBI profile and begin the systematic company search. The path is long, but the goal—the leadership of your own company—is worth it.