Business broker fee structures at a glance
| Fee structure | How it works | Sourced figure | Watch for |
|---|---|---|---|
| Flat percentage success fee | One percentage of the sale price, paid at closing, whatever the price. | Broker success fees of 5% to 12% of the sale price [5]. About one-third of surveyed advisors use a flat percentage [4]. | What the percentage is charged on: cash at closing, or total price including seller notes and earn-outs. |
| Lehman formula (sliding scale) | The percentage steps down as the price rises. In the classic version the fee is 5% of the first $1 million, 4% of the second million, and so on down [4]. | The most common success-fee structure, used by 51% of surveyed advisors [4]. | Where the tiers start and stop. Small changes to the bands move the fee more than the headline rate. |
| Double Lehman | The same stepped idea with the rates doubled, starting at 10% and falling to 2% [4]. | Many advisors who use a sliding scale describe theirs as a Double Lehman, with many variations [4]. | Variations that hold the top rate over a wider first band, which raises the fee on a smaller deal. |
| Accelerator (rising scale) | A base percentage up to an agreed target price, and a higher percentage on the amount above it. | Used by 16% of surveyed advisors [4]. | Whether the target price is realistic. Set it too low and you pay the higher rate on an ordinary result. |
| Minimum success fee | A floor on the success fee. If the percentage would produce less, you pay the minimum. | 75% of surveyed advisors charge one [4]. We found no dated source for typical minimum amounts. | On a smaller sale the minimum, not the percentage, often sets the real cost. Ask for it in dollars. |
| Upfront retainer or engagement fee | A one-time fee at signing to cover valuation, marketing materials and buyer research. | Firms with 20 or fewer employees typically charged $15,000 or less; larger firms most commonly $25,000 or more [4]. | Whether it is refundable or credited against the success fee if the business sells. |
| Monthly work fee | A fee each month while the engagement runs, regardless of outcome. | Two-thirds of advisors who charge one charge $5,000 to $10,000 a month [4]. | How long it runs, whether it stops at the letter of intent, and whether it is credited at closing. |
| Tail clause | If the agreement ends and you later sell to a buyer the broker introduced, the broker is still owed its fee for a set period. | Described by structure only; we found no dated source for typical tail lengths. | A named list of covered buyers, a fixed end date, and an exclusion for buyers who approached you first. |
How business brokers charge
Business brokers are paid mainly by a success fee: a percentage of the sale price, owed only if the business sells and usually paid out of the proceeds at closing. A 2025 fee guide from Nav put broker success fees at 5% to 12% of the final sale price [5]. Around that core, brokers and M&A advisors add other pieces: an upfront or monthly fee, a minimum success fee, and terms that decide when and on what the fee is charged.
The percentage tends to fall as deals get bigger, because the work does not grow in step with the price. In a survey of 189 US middle-market advisors, about 30% of whom described themselves as business brokers, the average success fee was 6.3% for a $5 million deal and 3.9% for a $20 million deal [4]. Fees varied widely at each size: on a $20 million deal, three-fifths of answers were between 2.5% and 5.0%, one-fifth were below 2.5% and one-fifth above 5% [4].
The seller pays the broker. A broker listing your business works for you under a listing agreement, and its fee comes out of your proceeds. That is different from a buyer-side firm, which a buyer hires and pays to find businesses. The section on who pays, further down this page, covers where Axia fits.
Success fee structures: flat, Lehman, Double Lehman and accelerators
A flat percentage is the simplest: one rate on the whole price. About one-third of surveyed advisors use it [4]. It is easy to understand and easy to compare between brokers.
A Lehman formula steps the rate down by tranche. In its classic version the fee is 5% of the first $1 million, 4% of the second million, and so on down [4]. It was the most common structure in the survey, used by 51% of advisors [4]. Few brokers use the classic rates on smaller deals; many use a Double Lehman, where the rates start at 10% and fall to 2% [4], or their own variation on the bands.
An accelerator works the other way: a base rate up to a target price and a higher rate above it, to reward the broker for beating the target. It was used by 16% of surveyed advisors [4].
Retainers, monthly fees and minimum fees
Three-quarters of surveyed advisors charge some kind of engagement fee on top of the success fee [4]. It can be a one-time retainer at signing, a monthly work fee, or payments at milestones such as finishing the offering memorandum or signing a letter of intent. About 10% of advisors use milestone fees [4]. Among advisors charging a monthly fee, two-thirds charge $5,000 to $10,000 a month [4]. Upfront retainers depended on firm size: firms with 20 or fewer employees typically charged $15,000 or less, and larger firms most commonly $25,000 or more [4].
Whether the engagement fee is credited against the success fee is negotiable. In the survey, 54% of advisors credited engagement fees toward the success fee [4]; the rest charge them on top. Ask for crediting in writing.
Minimum fees matter most on smaller sales. 75% of surveyed advisors charge a minimum success fee [4], and many said they have been raising their minimums. We have not found a dated source for typical minimum amounts, so we don't quote one. Ask each broker for the minimum in dollars, and compare it to the percentage at your realistic price.
Other terms that change what you pay
The headline percentage is only part of the cost. Read these terms in the listing agreement before you sign:
- What the fee is charged on. Enterprise value, cash at closing, or total consideration including seller notes, earn-outs, consulting agreements and real estate. A fee on total consideration can be owed on money you have not yet received.
- When the fee is paid on deferred amounts. About two-thirds of surveyed advisors require the full fee at closing even when part of the price is paid later [4].
- Exclusivity and term. How long the broker has the exclusive right to sell, and how you end the agreement.
- Tail clause. How long after the agreement ends a sale to a buyer the broker introduced still earns a fee, and whether buyers who approached you first are excluded.
- Expenses. 43% of surveyed advisors said expenses are not reimbursed [4]; the rest bill items such as travel or data rooms. Ask for a cap.
- Break fees. Most advisors do not charge an explicit fee if you reject a good offer [4], but check your agreement.
Licensing affects who can charge a success fee
A success fee on the sale of a company is transaction-based pay, so who may charge it depends on licensing. Most brokers and dealers in securities must register with the SEC and join a self-regulatory organization [1], which is why investment banks that sell companies by stock sale are registered broker-dealers. Since 2023, a federal exemption lets an M&A broker earn a fee on the sale of an eligible privately held company without registering, if the buyer takes control and will be active in managing the company [2]. Business brokers are licensed by the states, and the rules vary. Ask any broker which license or exemption covers the fee they are proposing. For how this differs between brokers and banks, see business broker vs investment banker.
Who pays the broker, and where Axia fits
In a normal sale, the seller pays the seller's broker out of the proceeds. If the buyer has hired its own intermediary, the buyer pays that firm. Some deals have both.
Axia Growth works on the buyer side. Axia is typically engaged and paid by the acquirer, does not represent sellers, and does not provide, arrange, or receive compensation for transaction financing [6]. Owners pay Axia nothing, whether or not they sell. Axia is not a business broker or advisor: it does not value businesses, negotiate terms, structure deals, or take part in due diligence or closing, and it holds no business-broker, real estate or securities license [6]. If you want someone on your side, hire your own broker, M&A advisor or attorney. See who pays and how it works for owners.
How to compare and negotiate broker fees
Fees are negotiable, and comparing proposals is easier if you ask every broker for the same things:
- The total fee in dollars at a low, an expected and a strong sale price, including any minimum.
- Every fee other than the success fee: retainer, monthly fee, marketing fee, expenses.
- Whether engagement fees are credited against the success fee at closing.
- What the success fee is calculated on, and when it is paid on seller notes and earn-outs.
- The exclusive term, how to terminate, and the tail period, with an exclusion for buyers you already know.
- Recent deals they closed near your size and in your sector, and how many buyers they would reach.
What the fee means for your take-home
A broker fee is one of several costs between the sale price and what you keep, alongside taxes, attorney and CPA fees, and any debt paid off at closing. A good broker can earn more than their fee by finding more buyers and better terms; a poor fit can cost you more than the fee. Start by knowing what your business is worth: the multiples index shows median EBITDA and SDE multiples by sector and size band [3], and the value range calculator applies them to your earnings. For tax, see taxes when selling a business.
If you are deciding who to hire, read business broker vs investment banker for which fits your deal size, should I use a business broker? for brokers, advisors and direct introductions, and selling a business without a broker if you would rather run the sale yourself. Owner pages by industry start at Axia for owners.