How the Contingent Consideration Trap Delays M&A Payouts

The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators · Jun 26, 2026 · 8m · transcript

In M&A, contingent consideration — or earnouts — can delay seller payouts for years, especially when tied to subjective milestones. This episode drills into a 2023 case: a $200 million deal for a cybersecurity firm where the earnout triggered a three-year dispute over whether revenue targets were met. Lucas and Luna unpack how earnout structures create misaligned incentives, why buyers often lowball earnout calculations, and what sellers can negotiate upfront — like clear accounting definitions and caps on earnout clawbacks. If you're a founder eyeing an exit, this episode gives you one…