The business sale advisory market includes three distinct professional categories — business brokers, M&A advisors, and investment bankers — each serving different transaction sizes and requiring different engagement structures. Understanding the differences helps Illinois business owners choose the right advisor for their specific situation.
Business Brokers
Business brokers specialize in transactions under $5M in total value, working with individual buyers, SBA-financed acquisitions, and owner-operated businesses. Illinois business brokers are typically licensed as real estate brokers, work on success-fee commissions of 8–12%, and manage the entire sale process from listing to closing. They are the appropriate advisor for the vast majority of Illinois small business sales and have deep experience with the specific operational and regulatory considerations in the state.
M&A Advisors and Investment Bankers
M&A advisors serve the middle market — transactions of $5M to $100M+. They typically charge both a retainer fee and a success fee (the Lehman formula is common: 5% of the first $1M, 4% of the second $1M, etc.). Investment banks serve larger transactions, usually above $50M, with institutional buyers and complex capital structures. For Illinois small business owners, M&A advisors become relevant when the business has grown to $3–5M in annual SDE or EBITDA and is likely to attract private equity or strategic buyer interest.
The best advisor for any Illinois business sale is the one with the most experience closing similar-sized transactions in similar industries in the Illinois market. Ask specifically about closed transactions, buyer databases, and marketing approach before committing to any engagement.