Second bite
The second bite is the founder's proceeds from the sale of rollover equity when the buyer exits.
In a sale
How much can the second bite be worth?
With a capable buyer the second bite can exceed the first sale; with the wrong one it can be worth nothing. It is paid when the buyer sells the business again, on the stake the founder kept. That range is why the size of the roll, and the choice of buyer, matter more than the promise of a second sale.
Where it comes up
Read it in context
In the articles
- The second biteIn the right recap, the second sale is larger than the first. In the wrong one, it is zero.
- Strategic, platform, add-on, sponsor: who buys whatDifferent buyers pay for different things. The process should include several.
- Structure is priceTwo offers with the same headline can differ by millions in what you keep.
See the terms with your own numbers
The Go-To-Market Analysis (GTMA) builds the file a buyer would build on your business, before a buyer does.