Because they can be potentially so lucrative to sellers, earn-outs are sometimes used to close the gap between what the seller wants and what the buyer might be willing to pay.

Question

Quizplus · Accepted Answer

Earn-outs allow sellers to potentially receive more money in the future based on the performance of the business, which can make a deal more attractive to buyers who may not be willing or able to pay the seller's full asking price upfront.

Because They Can Be Potentially So Lucrative to Sellers, Earn-Outs