If you work in exit planning or value advisory, you’ve probably heard the term “triggering event” tossed around a lot. But what is a triggering event, really—and how do you explain it to business owners in a way that actually gets them moving?
This article is written for advisors (CEPA, CPAs, planners, consultants) who want a clear, practical way to use triggering events as the starting line for serious exit and succession planning.
In general business language, a triggering event is any event that sets off a specific consequence, like a covenant being breached in a loan agreement, or a change in control clause being activated in a contract.
In exit planning, a triggering event has a much more specific meaning:
A triggering event is an independent, data-driven assessment of a business owner’s personal, financial, and business readiness that produces a range of values for the company and reveals the “value gap” between today’s value and potential value.
It’s the moment when:
As one exit-planning practitioner puts it, the triggering event is the point where the owner gains the knowledge they need to make intentional decisions instead of drifting toward retirement.¹
In other words:
A triggering event doesn’t mean “you sell your business tomorrow.” It means, “We finally know where we stand and what needs to happen next.”
A lot of owners want to talk about “someday.” A triggering event turns “someday” into a plan.
When you run a proper triggering event with a client, you typically walk away with four critical outcomes:
For many advisors, this becomes the natural entry point into the broader 7 stages of the exit planning process and the Value Acceleration Methodology™. The triggering event is stage one; everything else hangs off of it.
Triggering events can be planned or unplanned. As an advisor, you want to help clients act on the planned ones—before the unplanned ones force the issue.
Here are practical business triggering event examples you can use with clients:
Planned triggering events (ideal):
Unplanned triggering events (reactive):
Your goal as an advisor: Don’t wait for crisis. Use a formal triggering event to start the conversation while you still have time to build value.
Here’s a simple framework you can use in your practice:
Before you touch numbers, get clear on:
This prep work also sets the stage for later collaboration with an exit planner and the rest of the advisory team.
Collect:
The cleaner the data, the more credible your triggering event becomes.
Use your chosen valuation method or software to estimate:
This is where you show the owner that their business is not just “a multiple of EBITDA”—it’s a set of value drivers that can be improved.
Compare:
That difference is the value gap—and it becomes the anchor of your ongoing engagement.
Use a 3–5–10-year exit timeline to:
This turns a scary number (“You need another $8M in value”) into a doable roadmap.
Once the owner sees the size of the opportunity (or risk), they’re usually more open to forming a proper exit planning transition team. Point them to your resource on 7 roles on an exit planning transition team and clarify:
A triggering event is not “a one-off valuation.” It’s the front door to a complete exit planning process.
After the triggering event, you can naturally lead the owner into:
If you already follow a stage-based model, tie your language back to the 7 stages of the exit planning process so that triggering events always sit at stage one: “Know where you are before you decide where you’re going.”
For additional perspective you can share with clients, Regal Wealth Advisors notes that the triggering event is where owners first see their current value, potential value, and the actions needed to close the gap, making it the foundation of a successful exit plan.¹
In exit planning, a triggering event is a structured assessment of the owner’s personal, financial, and business readiness that produces a current business value, potential future value, and a clear value gap. It’s the formal starting point of a serious exit plan—not the sale itself.
Ideally, 5–10 years before a possible exit, or as soon as an owner starts asking, “Could I afford to step back?” The earlier the triggering event, the more time you have to grow value and de-risk the company.
At minimum: the owner and a lead advisor (often a CEPA, CPA, or exit planner). For best results, loop in the broader exit planning transition team, wealth advisor, attorney, and key internal leaders, so everyone works from the same numbers and value gap.
No. A triggering event is about clarity, not commitment. It doesn’t lock the owner into selling; it gives them the information they need to choose if, when, and how to exit on their terms.
If you position the triggering event as “the one conversation that changes everything,” you make it easier for owners to take the first step—and easier for your firm to lead them through a complete, disciplined exit planning journey.
¹ Paraphrased from Regal Wealth Advisors’ discussion of triggering events in exit planning.