An External CEO Before the Sale: What a Bridge CEO Solves and What It Shifts
Hire a general manager from outside, eighteen months before the company goes on the market, and the founder-dependency question is settled: the buyer finds a business that runs without its owner, due diligence goes smoothly, and the price reflects it. That is the reasoning as one hears it, in owners' circles and from some intermediaries. It is attractive because it turns a structural problem, a company resting on one person, into a recruitment, which is something owners know how to do. A bridge CEO is a good solution in certain situations. There are just four things the reasoning leaves out.
"With a general manager in place, the dependency on the founder disappears"
What usually happens: the dependency changes address. Consider a hypothetical case, invented for the purpose: a precision engineering company of 60 people in the Bernese Jura, whose owner, aged 63, hires a general manager from an industrial group. Eighteen months later, the newcomer signs the quotes, runs the monthly reviews and has replaced two workshop foremen. But the three customers who make up 45% of revenue still call the owner on her mobile, non-standard pricing still goes through her, and she sits alone on the board of directors. The acquirer examining this company sees two dependencies where there used to be one: the dependency on the founder, intact on everything that matters, and a new one, on a salaried executive nobody can be sure will stay after the sale. Making a company transferable means actually handing over relationships, signing authority and pricing decisions; a general manager can carry that handover, provided the owner truly lets go of what they say they are delegating.
"Twelve months are enough for the buyer to believe it"
What happens: the buyer reads the accounts, and accounts run on an annual cycle. A serious acquirer wants to see at least one full financial year under the new management, preferably two, with margins held or improved, and will want to meet the general manager with the owner out of the room. An executive who arrived six months before the sale mandate reads as stage scenery, and an experienced buyer will ask what happens if the scenery leaves. In the mandates I lead, the horizon that works is two to three years between the general manager's arrival and signing. That makes the bridge CEO an early decision, most often taken when the intended internal successor turns out to be unavailable while two or three financial years are still left to play.
"The buyer will be relieved to find an executive in place"
What happens depends on who is buying. A strategic acquirer often arrives with its own management and its own sales leadership; to them, the general manager you recruited is a duplicate executive salary, somewhere in the region of CHF 180,000 to 300,000 a year depending on size and sector, plus the exit terms you granted. A financial investor wants the opposite, a team that stays, and will very quickly open a direct conversation with your general manager about an equity stake in the acquisition vehicle. From that moment, a third person is negotiating at the table, with interests that differ from yours: a low entry price suits them, a long transition reassures them, and they know more than the buyer about the company's weak spots. Sometimes they put themselves forward as a candidate, and a management buyout led by someone who has known the company for two years is then an option to weigh on equal terms with the others, neither dismissed out of loyalty nor chosen out of convenience.
"An ordinary employment contract will do"
What happens: the sale arrives, and the contract says nothing about it. A general manager hired to run a company up to its sale needs three things in writing before the first day. What they receive if the sale closes: a transaction bonus, usually expressed in months of salary or as a fraction of the price, paid at closing and conditional on their still being there. What happens if the acquirer does not keep them: a longer notice period and a severance amount defined in advance, so that none of it is improvised mid-negotiation, where every franc you promise them comes out of your price. And what they know: confidentiality about the process, and a non-compete clause that would hold up before a Swiss court, meaning limited in time, territory and type of business, without which it is worth nothing. A management team costs money, and that cost is worked out before the team is built; the bridge CEO deserves the same arithmetic.
"The owner can then step back and wait for offers"
What happens: the sale process still needs to be led, and the general manager is the wrong person to lead it. They are negotiating their own future with the buyer, which disqualifies them from steering a negotiation in which they are one of the stakes. The owner remains the one who decides, on price, timetable and which buyer is chosen; what a bridge CEO frees them from is running the company day to day during the twelve to eighteen months when a sale process absorbs all attention. Leading the process itself, the sequence, the counterparts, the arbitration between board, trustee and lawyer, calls for a body with nothing to gain or lose in the make-up of the future management team.
What these four assumptions share is that they treat the hire as the end of the work. From what I observe, a bridge CEO succeeds when three conditions are met: the owner has already handed over what they say they are handing over, customers, signatures and pricing included; at least two financial years remain before signing; and the contract anticipates the sale instead of being overtaken by it. Without the first, the buyer finds one more executive and an intact dependency. Without the second, scenery. Without the third, you find out during the negotiation what your general manager is worth to the buyer, and what they cost you.