How to Prepare Your Tech Stack for an Exit
The 24-month playbook that keeps your valuation intact when the buyer’s advisor arrives
By Steele Consulting
Most founders start thinking about tech preparation for their exit about four months too late.
The reason is structural: tech DD doesn’t feel urgent until it’s imminent. Financial prep starts years in advance because the P&L is the P&L. Legal prep starts years in advance because it has to. Tech prep gets pushed because “we’ll handle it in DD” feels like an acceptable answer right up until the buyer’s advisor delivers findings in week three of the LOI period and the deal reprices by 15%.
In our 24 years at Steele Consulting — including work with clients on both sides of dozens of transactions — we’ve watched founders discover the same uncomfortable truth: almost every tech DD finding that reprices a deal was fixable, and most of them could have been fixed quietly, cheaply, on the founder’s timeline, in the 12 to 24 months before the LOI. Which is to say — now.
We covered what buyers actually look at in Tech Due Diligence: What Buyers Actually Look At When They Look at Your Software. If you haven’t read that one, start there. This post is the companion — the specific timeline of what to do about it before the buyer shows up.
The honest math on exit timing
The reason this playbook starts 24 months out isn’t aesthetic. It’s that the specific moves that most reliably protect valuation take real time:
- An IP chain-of-title cleanup takes 3–6 months if you have contractors to track down
- A SOC 2 Type II requires a 12-month evidence window
- Retiring the worst technical debt takes 6–12 months of real engineering effort
- Documenting the systems that live in one person’s head takes 3–4 months of consistent work
Compress any of this into the three weeks between LOI and closing and you’re negotiating from weakness. Spread it over 24 months and most of it happens in the background while the business grows.
What follows is month-by-month: what to do, in what order, with what level of effort. Not every business needs every item. Every item on this list has moved real money for real clients.
24 months out: Diagnose honestly
Run a mock tech DD on yourself
Hire an outside firm — us, or one of the specialist buyer-side DD firms — to write the exact report a buyer’s advisor would write. Don’t do it internally. Internal reviews are structurally biased toward “it’s fine.” Outside reviews are structurally biased toward finding what matters.
The mock DD gives you a prioritized list of what to fix across the five buckets (Ownership, Health, Team, Risk, Roadmap), with cost estimates. Everything downstream of this step runs off the mock DD.
Audit IP ownership
This is the single highest-return move in the whole timeline. Every developer, contractor, offshore partner, and third-party firm that has ever touched the codebase needs a signed IP assignment. Missing assignments from four years ago surface in buyer DD and can invalidate ownership of substantial parts of the system.
Why do this first: tracking down past contractors takes months. If you start at 24 months, you have time to find them. If you start at 6 months, some of them won’t be reachable.
18 months out: Make the systems transferable
The Documentation Push
Pick the three to five most critical systems in the business and have the owners write real documentation — not wikis nobody reads, but runbooks another engineer could use to operate the system cold. This is a 3-month project if done consistently.
The Secondary Owner Program
For each critical system identified in the mock DD, designate a second engineer who learns the system to competency. Pair them with the primary owner for a defined period — eight weeks of shared ownership, with the primary coaching the secondary through real operation. By 12 months out, every system has at least two people who can run it. That’s what kills the Key-Person Cost we wrote about in The Real Cost of an Underbuilt Tech Team at the point in time when it matters most.
12 months out: Fix what the mock DD surfaced
The Debt Retirement Sprint
You don’t need a pristine codebase for an exit — buyers know they’re buying a real business. You do need to address the specific issues a buyer’s scanner will surface immediately: outdated dependencies with known CVEs, exposed secrets in the codebase, test coverage below the single-digit percentages, and the three or four particular code paths your team has been telling you need rewriting since year one.
Scope this as a defined project. 12 months out is late enough that the work focuses on what buyers actually check and not on perfectionism.
The Change-of-Control Renegotiation
Pull every vendor contract. Flag any with change-of-control clauses that trigger termination or renegotiation on sale. For every one that matters, renegotiate the clause now — while you have leverage, time, and no acquirer in the room. Vendors are far more flexible when the change-of-control conversation is hypothetical than when it’s three weeks from closing.
6 months out: Compliance and security clean-up
Compliance posture
If your industry requires SOC 2, HIPAA, PCI, or GDPR compliance, start the formal engagement if you haven’t already. SOC 2 Type II requires a 12-month evidence window — if you can’t produce it at close, you’ll be remediating under acquirer pressure. SOC 2 Type I can be achieved faster but is a weaker signal.
Security audit
Separate from compliance, hire an outside firm to run a security audit against the kinds of criteria a buyer’s advisor will apply. The findings are rarely surprising; the point is to have them in hand before the buyer does, with a remediation plan already in motion.
Document incident history
Every security incident, near-miss, outage, or data issue in the past three years should be documented with: what happened, how long it lasted, what was impacted, what was remediated, what the current controls are. Undocumented incidents are more concerning to buyers than documented ones.
3 months out: Narrative alignment
By three months out, the banker or advisor working your sale has a business plan ready for buyers. The tech roadmap needs to be consistent with it — specifically, with the growth assumptions, the capability gaps, and the capital spending projection.
If the business plan assumes 3x revenue growth, the tech roadmap needs the infrastructure work that supports 3x load. If the plan assumes an expansion into a new product area, the roadmap needs the enabling capabilities. Buyers’ advisors specifically read for this coherence. Mismatches reprice deals.
Final 3 weeks pre-LOI: Prep the data room
Prepare the tech section of the data room. Documented IP chain-of-title. Vendor contract summary with change-of-control treatment. Security and compliance certifications. Architecture overviews. Incident log. Technical roadmap with CFO alignment. All of it ready, consistent, and in a form a buyer’s advisor can consume in a day instead of a week.
The data room isn’t the deal — it’s how fast the buyer can trust what they’re buying. Clean data rooms close faster at better prices.
What to do if you’re reading this late
If you’re less than 12 months from a planned exit, the playbook compresses but doesn’t disappear.
Prioritize ruthlessly in this order:
- IP ownership audit (highest return per dollar)
- Mock tech DD (so you know what’s actually broken)
- The Secondary Owner Program (fastest way to reduce Key-Person findings)
- Change-of-control renegotiation (vendors remain flexible until a deal is in the air)
Items you can’t complete in time: get them documented honestly, with a remediation plan and cost estimate, and present them to the buyer alongside the findings. The point isn’t to look perfect. The point is to control the narrative.
What to do if you’re already in LOI
If you’re reading this during an active DD and the findings are worse than you expected, three moves:
- Get ahead of the findings. Don’t let the buyer’s advisor deliver them to the buyer without you having framed them first. Every problem has a remediation plan and a cost estimate; present both.
- Argue with the implication, not the finding. The advisor is probably right that test coverage is 12%. They’re wrong that this justifies a $3M discount — bring your own cost estimate and the plan to fix it.
- Bring in outside credibility. Mid-DD, an external firm can produce faster, more credible remediation estimates than your internal team, and buyers weight outside estimates more heavily.
How this connects to the other decisions you’re making
Exit prep sits on top of several of our other frameworks. The DRIFT framework from the tech debt post is what the buyer’s advisor is measuring — the 24-month playbook is DRIFT, run deliberately, with a transaction deadline. The Key-Person Cost from the Underbuilt Team post becomes the Team bucket in tech DD, and the Secondary Owner Program is what closes it. The SaaS Sprawl post’s inventory discipline is what unlocks the vendor contract renegotiation step in month 12. Read in sequence, the three M&A posts — Tech DD, Acquiring a Company, and this one — give you the full playbook from both sides of the table.
Book a call
Twenty-four years of building custom software. Both sides of the table on more decisions than we can count. And a track record of telling clients honestly when the answer is us and when it isn’t.
If you’re sitting in the middle of this decision right now, that’s the conversation we’re built for. Book a 30-minute call and we’ll walk through it with your specific situation. No pitch. No pressure. You’ll leave with a clearer picture of what to do — whether you work with us or not.