Same price, four very different deals.

Deal structure is distinct from valuation multiple, and it is where most deals actually live or die. A seller fixated on the headline number can accept a structure that delays proceeds for a decade, transfers performance risk back onto themselves, or taxes the money at ordinary-income rates. This piece walks the four primary structures, the risk each carries, and the one comparison that matters — net proceeds, not nominal price. None of this is tax advice; the specific treatment of any deal is a question for the seller's own counsel.

§ 01 · The four structuresWhat changes hands, and when.

Each structure trades certainty against price, and timing against risk.

§ 02 · All-cash and earn-outsCertainty vs upside.

All-cash pays the full price at closing in a single wire. The seller gets maximum certainty, a clean break, and zero default risk — and pays for it with the lowest headline price, because buyers discount for certainty. It's the right structure for a health-or-burnout exit, an estate-planning deadline, or a well-capitalized buyer.

Earn-outs defer 20–30% of the price against post-close performance — usually a retention threshold (for example, full payout at 95%+ client retention over two years, partial below). The trade is a higher headline multiple (11×–12×) for retained risk: the seller stays economically exposed to retention, integration decisions they no longer control, and disputes over how the metric is calculated. Roughly 30–40% of earn-out deals end in a calculation dispute, which is why the measurement definition matters as much as the number.

§ 03 · Rollover and seller notesThe long-dated structures.

Equity rollover keeps the seller as a minority owner (typically 10–40%) of the acquiring platform. Most proceeds come at close; the retained stake rides the platform's growth to a "second bite of the apple" at the sponsor's eventual exit. Enter at ~10× and exit at ~15× and the retained equity appreciates well beyond the entry multiple — but the capital is locked for 4–7 years, the exit timing belongs to the sponsor, and platform leverage means the seller's equity absorbs losses first. It suits sellers who believe in the platform and want continued upside and involvement.

Seller-held notes turn the seller into the bank — financing 70–100% of the price over 7–10 years at 3–6% interest. About half of internal-succession deals run this way, because next-generation buyers rarely have acquisition capital. The upside is interest income and installment tax timing; the downside is extreme. The note is usually unsecured, default rates in internal succession run an estimated 15–20%, and a buyer with little money down has little skin in the game. A seller who finances should demand a security interest, a personal guarantee, an acceleration clause if retention drops, and senior position over any other lender.

§ 04 · The only comparison that mattersNet, not nominal.

Offers must be compared on net-after-tax proceeds and timing — never on headline price. A $10M all-cash deal taxed as a single capital gain can net less than a nominally identical $10M earn-out whose deferred portion is spread across tax years. The full risk-and-reward picture:

The decision reduces to four questions: when do you need the capital, how much involvement do you want, how confident are you in the buyer's ability to execute, and what is your tolerance for repayment contingency? Immediate need and low risk tolerance point to all-cash; a price gap with a capable buyer points to an earn-out; belief in the platform points to rollover; a trusted successor without capital points to a note. The tax treatment that swings these comparisons — installment-sale spreading, the qualified-small-business-stock exclusion on rolled equity, capital-gain versus ordinary-income character — is real money, and it is the seller's tax advisor's call, not the buyer's. The companion transaction-types piece covers the entity-level mechanics that sit underneath every structure here.

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