Deal Structuring
Earnout
A deferred, milestone-linked portion of the sale price that a seller receives only if the business hits agreed post-closing targets — inherently a collection-risk instrument for the seller.
Seller Example
Founder of a Bengaluru D2C skincare brand accepts ₹12 Cr upfront against a ₹20 Cr valuation with ₹8 Cr as a 24-month earnout, but negotiates continued operational control (not just an advisory role) during the earnout window, since the buyer's post-acquisition decisions on marketing spend and SKU cuts directly determine whether she ever collects the remaining ₹8 Cr.