When Should a Board Consider Selling a Company? Key Signals From Itay Sagie

Sagie argues that many boards treat M&A as a fallback when growth slows, cash tightens or liquidity pressure rises. His core takeaway: directors should evaluate selling alongside scaling, pivoting or staying independent before circumstances reduce leverage. That makes M&A a strategic option rather than an emergency escape route.

The most counterintuitive signal is strength: rapid revenue growth, happy customers, strong retention and an energized leadership team. Sagie notes that this may be when companies can command their highest valuations because strategic acquirers pay for momentum. Boards should ask whether they are operating from a position of maximum strength and whether it is worth understanding what the market might pay.

A second signal appears when a founder begins losing energy after years of driving vision, product, recruiting, customers and culture. Sagie says that does not automatically mean a sale is required; a CEO transition or secondary transaction may be better in some cases. A third signal is repeated inbound buyer interest, which can reveal that strategic acquirers see value or market positioning that management has not fully recognized.

Boards often turn to M&A when growth slows, competitors strengthen or cash reserves shrink, but Sagie warns that buyers can see those same challenges. In that situation, acquirers may gain negotiating leverage and valuations can reflect limited options. A strategic reset, product pivot, leadership change, market repositioning or operational turnaround may create more value than an immediate sale.