My take: dual representation shouldn’t exist in business brokerage.
It’s mostly a hangover from real estate, but it happens sometimes in Main Street M&A—a broker representing both the buyer and seller.
But should it?
One way to think about when dual representation makes sense:
Transparent Value → Dual Representation Works Fine
Think stock exchanges, currency exchanges, ticket marketplaces. High liquidity, standardised units, transparent pricing. You’re trading cash for something with clear, known value. Limited room for negotiation. The intermediary mostly plays a matching function—connecting buyer and seller, not negotiating on anyone’s behalf.
Readily Discernible Value → Grey Area
Real estate sits here. Comps are readily available, the asset is tangible, and there’s some room for negotiation—but once the deal closes, it’s done. The intermediary does play a role in shifting value and risk between parties, but the range of outcomes is relatively narrow.
Opaque Value → Dual Representation Is a Problem
Business sales. The assets are often intangible: brand equity, customer relationships, proprietary processes, IP. Dozens of deal terms can materially shift value and risk between parties (e.g. working capital pegs, earnouts, seller notes, reps and warranties, indemnification caps, escrows, non-competes).
As a seller, why would you want your advisor being paid on both sides?