By Lou Sokolovskiy

When George Coulam, the owner of the Texas Renaissance Festival—America’s largest event of its kind, drawing over 500,000 visitors annually—decided it was time to retire, he faced a dilemma familiar to many baby-boomer founders. Despite numerous suitors, not a single bid felt right for the 86-year-old man. This moment wasn’t just about finding a buyer—it was about handing off a lifetime’s work as documented in the 2024 HBO docuseries “Ren Faire.” 

Across the U.S., stories like Coulam’s are becoming increasingly common: nearly half of all private businesses—some 12 million companies, collectively valued at about $10 trillion—are owned by baby boomers poised to step back. As 2025 unfolds, that wave of owners entering retirement is reshaping the lower‑middle‑market M&A landscape, heralding what analysts are calling the largest transfer of business ownership in history.

Ticking Clocks

The imperative to sell is driven by both personal and practical factors. Most boomer-run businesses lack a ready successor: nationally, only about 30% of family firms survive into the second generation. Census data underscore the urgency: roughly 20% of private business owners are over 65 (and another 30% are 55–64). In other words, on any given day thousands of owner-managers retire or start planning exits. Investors observe that despite economic ups and downs, “a historic number” of entrepreneurs turning 65 means deal pipelines are being fed by owners ready to transact.

Tax policy is adding a sharp deadline to these personal plans. Under current U.S. tax law, the estate and gift tax exemption is at record highs (more than $13 million per person for 2024) but according to the IRS, it is scheduled to revert to roughly $5 million (inflation-adjusted) after 2025. In practice, that means owners who sell or transfer assets this year can benefit from a much larger tax break than they could even a few years from now. Experts note that “the current Estate Tax Exemption will sunset at the end of 2025”, driving a push to monetize businesses before the window closes. Estate planners and CPAs are busy modeling scenarios: selling now lets owners lock in gains under the high exemption and “step up” asset basis, reducing future tax burdens.

Emotional Exit

With both retirement timing and tax strategy urging exits, many veteran owners are leaning on professionals. Deal brokers and advisors report owners’ top questions are often existential (Who do I sell to?) as much as financial. Many executives admit they never expected to sell: they are used to “being Peter Pan” CEOs and must now work through the emotional aspects of letting go. As a result, most are engaging experienced M&A intermediaries to handle valuations, identify buyers, and structure ownership transition plans. Wealth managers also emphasize discussing family goals: only about 30% of owners have any formal succession plan, so conversations are being initiated to avoid nasty surprises for heirs.

Buyer Surge

Buyer Surge

The upshot for the lower-middle market is a growing supply of mature, profitable companies seeking buyers. U.S. middle-market firms (roughly $10 million–$1 billion revenue) number around 300,000 and generate over a whopping third of U.S. GDP. With baby-boomer owners in the crowd, even a small uptick in sellers can have a noticeable effect on dealflow. Private equity and family offices are paying attention: dry powder is plentiful and looking for solid assets. Some commentators call it a seller’s market – more potential buyers with cash chase fewer core businesses – while others warn that if too many boomers sell at once, it could tilt toward buyers and pull down prices.

Many owners value legacy over lump sum: a survey cited in media shows 60% of boomer sellers were open to seller-financing or earnouts to smooth the transition. In practice, this means buyers may pick up businesses at more affordable prices or with creative deal terms, while sellers retain a stake or steady payout.

Local dynamics are also in play. In places with many closely-held firms (for instance, family real estate or services), the succession wave can ripple into other markets. New Jersey analysts note that aging local businesses influence the housing and commercial sectors when owners downsize or retire. Across industries, the ready availability of seasoned businesses has attracted investors. For lower-middle companies with stable cash flows, interest from both strategics and financial sponsors remains high.

In brief, the “silver tsunami” of retirements, combined with looming tax changes, is a high-impact driver of mid-market M&A in 2025. Unlike headline risks (tariffs, Fed policy), this demographic shift is not a cyclical blip but a persistent trend. Owners who plan well can capitalize on current valuation levels and tax breaks; buyers who act quickly can acquire enduring businesses. Both sides are advised to engage experts – from tax lawyers to M&A bankers – to navigate this once-in-a-generation transition. 

Subscribe to our LinkedIn newsletter for sector insights, expert commentary, and the latest market trends—delivered straight to your inbox.

Tell us what you think on LinkedIn or Instagram (@opusconnect). Explore our events and join the community.

Aug. 2025