Over half of UK business owners begin exit planning within their first five years
Posted by: electime 30th September 2025
Capital on Tap surveyed 250 small business owners across the UK to explore their attitudes towards exit strategies, the types of exits they consider, and how far in advance owners are thinking about leaving their business.
- Nearly half of business owners consider selling their business to a third-party buyer
- 22% of owners believe an exit plan should be considered when setting up their business, despite only 8% actioning this
- Emotional attachment to the business is the biggest challenge for small business owners deciding to exit their business
A well-defined business exit strategy is crucial for any owner looking to sell or step away from their company, helping ensure a smooth, profitable transition. However, a recent Capital on Tap survey of 250 small business owners across the UK found that 79% do not have one in place. Alarmingly, over a third (36%) have no intention of creating one, despite one in 12 planning to fully exit their business within the next one to three financial years.
You can read the research in full here: https://www.capitalontap.com/en/blog/posts/uk-business-exit-strategy/
Nearly half of business owners consider selling their business to a third-party buyer
Selling to a third-party buyer is the most popular exit strategy, considered by 47% of UK business owners. It offers a clean break, potential high returns, and is often the only option for solo founders without a successor.
Family succession is the second most popular exit strategy, chosen by 46% of owners and by 74% of businesses with over 50 employees. Selling to a co-founder is also common, with 41% of owners open to it. Among larger firms, 84% consider either selling to a co-founder or using employee ownership trusts. Acquisitions (68%) and mergers (61%) are also popular options.
22% of owners believe an exit plan should be considered when setting up their business, despite only 8% actioning this
Similarly, 16% of small business owners think exit planning should begin when writing the business plan to allow for clearer long-term decision-making from the start, with just 3% heeding their own advice.
Interestingly, the least favoured time to start planning an exit is between the 16th and 20th financial year, suggesting that most owners recognise the importance of planning well before the later stages of business life, rather than leaving it too late.
Rebecca Alford, Chief Financial Officer at Capital on Tap adds, “Too often, business owners miss out on maximising the value of their business or face unexpected complications – simply because they haven’t been fully informed about how to develop an exit strategy tailored to their specific circumstances. A qualified advisor can help you structure your exit to maximise financial return, avoid costly mistakes, and create a smooth transition for everyone involved. The earlier you can seek this advice, the more prepared you will be later on.”
Emotional attachment to the business is the biggest challenge for small business owners deciding to exit their business
One of the most significant challenges when it comes to deciding when to exit their business is emotional attachment, with 29% of owners admitting that letting go of the business they’ve built is their biggest obstacle. This is followed by finding the right buyer or successor, with 28% saying this is a major issue. Also, 24% find the legal side of exit planning very tricky, as contracts, compliance, and regulations can be tough to navigate without help.
For 23%, accurately valuing their business is a key hurdle. Determining a fair and realistic valuation is crucial for negotiating a successful exit; however, many find this step particularly challenging without expert guidance.
About Capital on Tap
Capital on Tap makes it easy for small businesses to manage their business spending, access funding, and earn cashback, travel, and gift card rewards. Over 200,000 small businesses have spent more than £10 billion on their Capital on Tap Business Credit Cards across the US and UK. The company has achieved remarkable recognition, ranking #1 in the Fintech, Financial Services & Insurance category and #5 overall in the Financial Times’ inaugural Europe’s Long-Term Growth Champions 2025 list.
Sources and methodology
All data was taken from a survey of 250 small business owners. The survey was conducted in May 2025.
