Selling a Higher Education Business

Most Higher Ed-focused vendors are valued on a multiple of cash flow (often EBITDA or SDE, depending on size). The multiple usually moves with renewal durability, RFP exposure, and how services-heavy delivery is. Buyers pay more when renewals clear budget committees without a full re-sale, implementations stay on time for Aug/Jan starts, and security and accessibility reviews rarely stall growth. For a quick estimate grounded in transaction data, use Rejigg’s free valuation calculator, then sanity-check it against system versus campus mix, grant versus base-budget revenue, and delivery margins.

Sometimes. SBA 7(a) tends to work best when earnings are consistent, financials are clean, and customer concentration is manageable. Higher Ed seasonality, RFP timing, and implementation-heavy delivery can be fine, but lenders usually want evidence that cash flow holds up across the academic year and that the seller will support a real transition. Use Rejigg’s SBA loan calculator to model payments and coverage, then organize lender-ready financials and contracts in a secure data room.

Many Higher Ed deals take longer than typical B2B because diligence often expands into procurement mechanics, security and accessibility documentation, and term-start implementation capacity. The stages are the same: outreach, calls, LOI, diligence, then closing. The extra time usually comes from validating renewal paths, RFP history, and delivery risk around Aug/Jan. Rejigg can help compress the timeline by keeping NDAs, buyer Q&A, and a structured data room in one workflow, so you are not rebuilding the same Higher Ed diligence package for each buyer.

No. Brokers often charge 5–10% for buyer access and process management, and some owners prefer to run the process directly. If you do it yourself, you still need confidentiality controls, qualified buyers, and an organized diligence workflow. Rejigg provides pre-vetted buyers, digital NDAs, a built-in data room, owner-to-buyer messaging, and an offer comparison dashboard. That setup is especially useful in Higher Ed, where buyers tend to ask detailed questions about campus procurement, renewals, and implementation capacity.

Confidentiality matters in Higher Ed because rumors can unsettle champions, slow renewals, or invite competitive scrutiny. Use staged disclosure: a teaser first, then share customer names and contracts only after a buyer is qualified and has signed an NDA. It also helps to avoid reference calls until late in the process, since campus staff can end up in politics they did not ask for. On Rejigg, buyers are pre-vetted, NDAs are signed digitally, and you can control folder-by-folder access in the data room.

In addition to financials and tax returns, Higher Ed diligence often includes customer contracts with change-of-control terms, renewal schedules, and any RFP or bid history tied to major accounts. Buyers commonly request security questionnaire responses, data handling policies relevant to FERPA, and accessibility materials such as VPATs or WCAG testing notes, if you have them. Expect questions about customer mix (system versus single campus, public versus private, two-year versus four-year) and proof you can staff Aug/Jan delivery peaks. Use due diligence and closing to stay ahead of requests.

Working capital can be a bigger topic in Higher Ed because cash timing is uneven. Fiscal-year purchase orders, delayed invoicing, and services clustered around term starts can create short-term cash strain even in a healthy business. Buyers often set a normalized working capital target so they are not funding a pre-close cash gap. Bring monthly cash patterns that match the academic calendar, and be ready to explain deferred revenue and prepaid services. Rejigg’s offer comparison tools help you weigh working capital terms across offers, not just the headline price.

Both are common. Buyers often prefer asset deals to reduce legacy exposure, especially around data privacy, old contract commitments, or employment matters. Sellers often prefer stock deals for tax treatment and a cleaner transfer. In Higher Ed, contract assignability and change-of-control language can dictate what is practical, and some campuses require notice or re-papering either way. Get tax and legal input early, and keep contracts organized so consent requirements are easy to spot. Rejigg’s data room helps buyers review and track contract terms efficiently.

Earnouts show up when a buyer sees uncertainty in renewals, procurement timing, or growth. In Higher Ed, earnouts tend to work better when they are tied to metrics you can influence, such as renewal dollars collected, net revenue retention by cohort, or new contracts signed, with timelines that reflect budget cycles and RFP delays. Make sure definitions are tight, including timing, exclusions, and what happens with delayed signatures. Rejigg’s offer comparison view helps you line up earnout triggers, caps, and timelines side by side before you agree.

Buyers often ask for a non-compete of about 3–5 years and a non-solicit covering employees and customers. In Higher Ed, they may also ask for restrictions tied to certain conferences or specific institution types, since those channels can move the market. The practical issue is scope, including which products are covered and which geographies or segments are off limits. Terms vary by deal size and state law, so legal review matters. Rejigg’s offer comparison dashboard helps you evaluate restrictive covenants alongside price, payout timing, and risk.

Accessibility can block procurement quickly in Higher Ed, especially for student-facing tools and LMS-adjacent products. Buyers usually focus on sales friction if you cannot pass accessibility review and on remediation cost after closing. If you are not fully documented, it still helps to show a consistent process: how issues are reported, who triages them, how fixes are tested, and what your current backlog looks like. Keeping VPATs, audit results, and remediation history organized speeds up diligence. Rejigg’s data room lets you store and share accessibility materials in a structured way.

Taxes depend on your entity type and whether the deal is structured as an asset or stock sale. Sellers often get surprised by purchase price allocation in asset deals, which can shift proceeds into ordinary income, and by state tax complexity if you sell across many states or have nexus in multiple places. If services revenue is meaningful, revenue recognition timing can also affect the year you owe tax. Bring a CPA in early, ideally before LOIs so you can model after-tax outcomes across a few structures. Rejigg keeps offers and key terms organized for faster advisor review.

Some campus contracts require change-of-control notice, restrict assignment, or reference procurement rules that lead to re-papering. Even when consent is not strictly required, campuses may still ask for security, privacy, or subprocessor updates, especially if student data is involved. Build a contract inventory that flags assignment language, renewal dates, and any unusual obligations like price holds or custom SLAs. It can also help to plan how you will communicate the change to key stakeholders. Rejigg’s data room supports staged sharing, including redacted contracts early and deeper access later.

Many transitions run 3–12 months. In Higher Ed, it is often worth covering at least one renewal season and one term-start delivery peak, usually Aug/Jan, so the buyer sees the real operating rhythm. The right duration depends on how much the founder is still involved in escalations, integrations, and renewal saves. A good transition plan spells out responsibilities, such as executive introductions and escalation coverage, and what is explicitly out of scope, such as day-to-day support tickets. Use transitioning after the sale to map the timeline.

Most of the time, you should wait until after LOI or until a buyer has clearly shown they can close. Campus references can create political noise, especially if a champion worries procurement or leadership will overreact. When you do share references, match them to the buyer’s questions: public versus private, two-year versus four-year, and system versus single campus. Pick contacts who understand procurement and renewal steps, not only end users. Rejigg helps by supporting staged disclosure with pre-vetted buyers and a controlled reference process so calls happen at the right time.

Common issues include unclear financials, especially blended product and services margin, and contract promises that were never written down. Buyers also get nervous when renewals and escalations depend heavily on the founder or when concentration hides inside a single system office, grant program, or state footprint. Security and accessibility gaps can also slow or stop deals if documentation is missing or repeated blockers show up in customer history. Many of these can be manageable when disclosed early with a clear mitigation plan. Rejigg reduces late surprises by structuring diligence materials and letting you reuse clear answers across buyers.

Offer quality in Higher Ed often comes down to fit with how revenue and delivery behave across the academic year. Compare cash at close versus earnouts or seller notes, working capital targets, and how much of the price depends on renewals that may be delayed by procurement steps. Also, look at transition expectations and whether the buyer has a plan for security, accessibility, and bid responses. Small differences in definitions and timing can matter more than a higher headline number. Rejigg’s offer comparison dashboard lines up enterprise value, contingencies, and timelines so you can see risk clearly.