Broker vs marketplace vs FSBO

Broker vs marketplace vs FSBO at a glance

Factor	Broker or M&A advisor	Online marketplace listing	For sale by owner (FSBO)
What it is	An intermediary who prices, markets, screens, and negotiates	A paid or free advertisement on a business-for-sale website	The owner finds and negotiates with buyers directly
Direct cost	Success fee at closing; sometimes a retainer, minimum, and tail	Listing or subscription fee; no success fee to the site in the usual model	None
Who does the work	Broker, with the owner supplying information	Owner, unless a broker placed the listing	Owner
Reach	Targeted outreach plus listings the broker chooses	Broad and inbound; anyone browsing the category	The owner’s network, competitors, inbound approaches
Confidentiality	Blind summary, NDA, staged disclosure run by a third party	Depends entirely on how the owner writes and manages the listing	Hardest: the owner’s own name is on every conversation
Buyer screening	Funds, ownership chart, and regulator eligibility checked before exclusivity	Seller must do it	Seller must do it
Valuation	Broker opinion of value before going to market	Seller sets the asking price	Seller sets the asking price
Best for	Owners who want competition among buyers and cannot afford a leak	Smaller or asset-type sales where exposure matters more than secrecy	Sales to a known buyer: a partner, manager, neighbor operator
Still needed	Cannabis attorney, CPA	Cannabis attorney, CPA	Cannabis attorney, CPA

All three routes are lawful and all three produce closed sales. The right one depends on the business, the likely buyer, and how much of the process the owner can carry.

What does each route cost?

Broker. Most are paid a success fee at closing. Published general brokerage guides put flat commissions at 8% to 12% on sales under $1 million, and larger deals often use the Double Lehman scale of 10% on the first $1 million, 8% on the second, 6%, 4%, then 2%. Some advisors add a retainer or minimum fee, and most agreements include a tail; law-firm guidance notes advisors often propose 18 to 24 months. These are general industry figures, not the rates of any particular firm. Detail is in cannabis broker fees and commission.

Marketplace. Listing sites charge the seller, or the seller’s broker, to advertise. The cost is small next to a success fee. Fees and packages change, so check the site’s current terms.

FSBO. No intermediary fee. The owner still pays an attorney and a CPA, as in every route, and spends their own time.

Illustrative arithmetic: on a $2,000,000 sale, a Double Lehman fee is $100,000 on the first million plus $80,000 on the second, or $180,000. That is the amount a broker has to earn back through a higher price, better terms, a faster close, or a deal that would otherwise have failed. If the buyer is already at the table on fair terms, the broker may not earn it back. If the alternative is one unscreened offer with 17% cash at close, the math is different.

What does a marketplace listing do, and not do?

A marketplace listing advertises. It puts a description in front of people actively searching for businesses to buy. General sites carry dedicated cannabis categories with dispensaries, cultivation facilities, and licensed real estate, and specialist cannabis property and business sites exist as well.

A listing does not:

• Value the business or check the asking price against current state conditions.
• Verify that inquirers have funds or are who they say they are.
• Check whether a buyer can be approved by the regulator.
• Keep the sale confidential. That depends on the listing text and on who handles inquiries.
• Negotiate, manage diligence, or coordinate the approval filing.

None of that is a criticism. It is not what a listing site is for. Many brokers use the same sites as one channel. The question is who does the rest of the work.

Cannabis adds two listing-specific cautions. First, the pool of people who can legally complete the purchase is a small fraction of the people who can click on an ad, so expect a high ratio of unqualified inquiries. Second, a listing that advertises a “license for sale” can misdescribe what the state allows. In many states the license itself cannot be assigned, and the transaction has to be an approved change of ownership. See the state license transfer rules overview.

What does selling a cannabis business yourself involve?

Everything in how a cannabis business sale works, done by the owner while still running the business:

1. Recast the financials and reconcile point-of-sale, track-and-trace, deposits, and tax returns.
2. Set a defensible price. The valuation pillar and the site’s calculators are a starting point.
3. Write a blind summary and a full information memorandum.
4. Find buyers, get NDAs signed, and keep a log of who received what. See NDA and confidentiality.
5. Screen each buyer: proof of funds, ownership chart, licensing history, ownership caps. Washington, for example, limits a true party of interest to five retail licenses, so an operator at the cap cannot buy a sixth.
6. Negotiate a letter of intent, including the payment mix. With SBA loans unavailable, most offers include a note, stock, or an earn-out that has to be valued and secured.
7. Run diligence, manage the landlord, and keep the deal moving through a regulator review that attorneys report at 3 to 18 months depending on the state.

FSBO works best when steps 4 and 5 are already done, because the buyer is known: a partner buying out another, a general manager, a neighboring operator who is already licensed in the state. In that case the hard parts of a broker’s job, finding and screening, are not needed, and a good attorney and CPA may be all the help required.

It works worst when the owner negotiates alone with a single experienced acquirer. The acquirer has done many deals and the owner has done none, and with no competing offer there is little leverage on price, structure, or outside dates.

Where cannabis changes the usual comparison

In an ordinary small-business sale, the broker-or-not question is mainly about price and effort. Cannabis adds three things.

• A failed buyer costs more. Exclusivity plus regulator review can consume most of a year. If the buyer is then denied or cannot fund, the seller restarts with a staler business and a market that knows a deal fell through. Pre-screening is where the most value is protected. Warning signs are listed in mistakes cannabis sellers make.
• Leaks are more damaging. Staff are badged individuals who can leave for a competitor quickly, and local markets are small. A public listing that can be traced to a storefront is a real risk. Approaches are covered in selling a cannabis business confidentially.
• Who may be paid. An owner can always sell their own business. A person paid to broker it may need a state license. California’s real estate broker definition covers business opportunities, for instance. If you pay a finder or consultant a success fee, check business broker licensing by state.

Which fits you?

A broker fits if:

• You do not already know who the buyer is, or you want more than one bidder.
• A leak to staff, vendors, or competitors would hurt the business.
• The deal is likely to include a note, stock, or an earn-out that needs to be compared and negotiated.
• You do not have 10 to 20 hours a week to spare for a year.

A marketplace listing fits if:

• The sale is small, or is mainly assets or real estate, and wide exposure matters more than secrecy.
• You can write a blind listing, insist on NDAs, and screen inquiries yourself.
• You are willing to handle a large volume of unqualified contacts.

FSBO fits if:

• The buyer is a partner, manager, family member, or a licensed operator you already know.
• Price and terms are largely agreed and mainly need documenting.
• You will hire cannabis counsel early and let them run the approval filing.

A hybrid fits more often than people expect. Some owners get a broker opinion of value and then negotiate with a known buyer themselves. Others engage a broker but carve out a named buyer they found on their own at a reduced fee. Both are worth raising with any broker; the questions to ask are in why use a cannabis-specialist business broker.

This comparison is educational and is not legal or tax advice. No route guarantees a sale, a price, or regulator approval.