HonoluluA Honolulu insurer sells abroad
In spring 2026 kWh Analytics, a Honolulu-built clean-energy insurer founded by Richard Matsui, agreed to be acquired by the UK insurer Beazley.
Hawaii Business Magazine, 2026
Sell a business in Hawaii
The road from today to the years after a sale runs through Hawaii's rules. Here it is in the order you will meet them: where you stand, what the state takes, the rules of the sale, who buys, and what the money can do after.
ComplexityMediumTax on the gain7.25% 2025Deal volumeLowEstate tax
Hawaii is a smaller market, with fewer buyers competing for any one business. The state takes a meaningful share of the gain, 7.25% at the top, with part of a long-term gain excluded. Expect an estate tax to plan the proceeds around.
Tax on the gain: Capital gains capped at 7.25%; ordinary income tops at 11%.
Today
Where you stand
Hawaii caps the state tax on a long-term gain at 7.25 percent, then makes the buyer wait on a tax clearance before paying you.
A small-business economy: half of private employment, with more establishments closing than opening in the latest year measured, so the pool of sellable firms is not growing.
Small-business employees
0
people employed by small businesses, 49.6 percent of the private-sector workforce.
SBA Office of Advocacy, 2025
Small-firm employment share
0.0%
of Hawaii employment held by small firms in 2021, above the national share.
SBA Office of Advocacy, 2021
Establishment churn
0
Opened
0
Closed
0
Net loss
SBA Office of Advocacy, 2024
Between March 2023 and March 2024, 4,609 establishments opened and 4,813 closed, a net loss of 204; small firms accounted for most of both.
The elements this touches
- TmTime The years before you want out. It feeds the exit-readiness score and never moves the price; every other decision is planned against it.
ListenThe Hawaii briefing, read aloud
The deal team on what changes when you sell a business in Hawaii.
Before the letter of intent
What Hawaii takes
The tax on the gain, and what to settle before a buyer names a price
Long-term gains get a capped 7.25 percent rate while wages top out at 11 percent. A frozen estate tax exemption of 5.49 million dollars catches estates the federal tax ignores.
State tax on the gain
0.00%
Capital gains capped at 7.25%; ordinary income tops at 11%.
Tax Foundation, 2025
A founder on film
On what he learned about tax on the way to the sale.
Lewis Titus Wastewater purification and manufacturing · Wyoming
Gains capped at 7.25 percent
Hawaii taxes long-term capital gains at an alternative capped rate of 7.25 percent, while the top ordinary income rate is 11 percent.
A frozen estate exemption
The state estate tax exemption is 5,490,000 dollars, not indexed to the federal figure, with graduated rates from 10 to 20 percent above it.
The rate is the state's top rate on the gain for the year shown, the same figure as the indicator in the hero, so the two can never disagree.
The elements this touches
- TxTax Strategy The deal and entity structure, set before the letter of intent. FNDRS tracks whether it is in place. It never moves the price; it changes what you keep.
- ApAfter-Tax Proceeds What you keep at close. FNDRS records the pre-tax walk-away and the gap to your number. It never moves the price, and the tax on it is a question for your CPA.
Under contract and at closing
The rules of the sale
The rules a sale in Hawaii runs under
An asset sale triggers a bulk-sale report to the tax department and a tax clearance the buyer waits for. Sale-of-business non-competes hold; tech-employee non-competes are void.
01Ten days to report
Under HRS 237-43 a bulk sale of business assets must be reported to the Department of Taxation within ten days of possession or title passing (Form G-8A).
Hawaii State Legislature, 2025
02The buyer holds your price
The buyer must withhold the purchase price until the department certifies the seller's taxes are paid, or become personally liable up to the price paid.
Hawaii State Legislature, 2025
03Sale non-competes still hold
Since 2015, non-compete and non-solicit clauses in employment contracts at technology businesses are void (HRS 480-4); non-competes signed in a sale of a business remain enforceable if reasonable.
Ogletree Deakins, 2015
The elements this touches
- LcLegal & Compliance Contracts, licences, and filings in order and enforceable. The FNDRS valuation reads it, and the score moves the multiple.
- DrData Room The documents a buyer will ask for, ready before they ask. FNDRS tracks it in the deal-readiness report card; it decides how fast and how cleanly a deal closes.
One thing you would not guess
Hawaii voided non-competes for technology employees in 2015, years before the federal government tried to, yet still enforces the one you sign when you sell.
Act 158 of 2015 (HB1090) made non-compete and non-solicit clauses void in employment contracts of any business earning most of its revenue from software or IT development.
A non-compete given as part of selling a business is treated differently and is likely to be enforced, since real money changed hands for it.
When the process opens
Who buys
Who shows up for a business in Hawaii
Exits are rare enough that two in one quarter made the news. The buyers came from outside the islands, and both founders had moved home to build.
StatewideVinovest goes to StartEngine
The same quarter, StartEngine bought Vinovest, a wine and whisky investing platform co-founded by Brent Akamine with over 200,000 users and roughly 140 million dollars managed.
Hawaii Business Magazine, 2026
StatewideBuilt and sold at home
Local observers size Hawaii's technology ecosystem at about 3.9 billion dollars, and read the 2026 exits as companies now being built and sold without leaving.
Hoodline, 2026
The elements this touches
- SyStrategic Synergy What one buyer gains that another cannot. The buyer at the table prices it, which is why the sell-side process goes looking for them.
Day 0, and the years after
After the close
What Hawaii lets the proceeds do
Hawaii has its own self-settled asset protection trust, limited to liquid assets and a quarter of net worth, and exempt from the rule against perpetuities.
CloseDay 0
Proceeds land. What the state keeps of them is settled above; what it lets them do from here is below.
Trust under the ActForever
The rule against perpetuities does not apply to transfers made under the Act, so such a trust can run indefinitely.
A trust shielded from creditors
The Permitted Transfers in Trust Act (2010, HRS 554G) lets a settlor fund an irrevocable Hawaii trust shielded from most of their own creditors.
WealthA quarter of net worth
Only cash, marketable securities, life insurance and non-private annuities qualify, and a transfer is valid only up to 25 percent of the settlor's net worth, sworn by affidavit.
WealthWhere FNDRS comes in
The post-exit wealth plan is the third act of the same engagement, and it starts in diligence, before the letter of intent, when a move or a trust can still change the answer.
FNDRSThe elements this touches
- EsEstate Architecture Trusts and ownership set up before the letter of intent. It changes what the family keeps, not what a buyer pays.
- ApAfter-Tax Proceeds What you keep at close. FNDRS records the pre-tax walk-away and the gap to your number. It never moves the price, and the tax on it is a question for your CPA.
People who walked it
Founders
Founders who worked with FNDRS, in their own words
From founders elsewhere
What founders say about working with FNDRS
No founder in Hawaii is quoted yet. These are founders in other states, quoted word for word, each described by role and state.
1 of 3
“I definitely don't think we'd be in the same spot without you guys.”
No founder in Hawaii is on film yet. These are founders in other states who worked with FNDRS.47 founders on film
Nearby
Other states in the West
| West | Tax on the gain | Complexity | Deal volume |
|---|---|---|---|
| Alaska | None 2025 | Very low | Very low |
| Arizona | 2.5% 2025 | Medium | High |
| California | 13.3% 2025 | Medium | Very high |
| Colorado | 4.4% 2025 | Low | Medium |
| Idaho | 5.3% 2025 | Medium | Low |
| Montana | 4.1% 2025 | Low | Very low |
| Nevada | None 2025 | Medium | Low |
| New Mexico | 5.9% 2025 | Medium | Low |
| Oregon | 9.9% 2025 | High | Medium |
| Utah | 4.5% 2025 | Medium | Medium |
| Washington | 9.9% 2025 | High | High |
| Wyoming | None 2025 | Low | Very low |
Your next step
The road starts with one step
Know where you stand in fifteen minutes, or talk the Hawaii sale through with a dealmaker. Either way, no pitch and no obligation.
Selling in Hawaii? Start with a conversation
No pitch and no obligation. If the honest answer is not yet, we will say so, and say what to work on.