The Best Time To Exit Your Company..?
Virtually all business owners will eventually consider when and how to exit…
That may be after a few years or a few decades…
Retirement, reward, company failure, exhaustion, time for a change, or wanting to spend more time with family are all valid reasons for leaving…
Similarly, what is critical to an owner in negotiating an agreement with a prospective buyer varies: some owners are more driven by money, while others are more motivated by safeguarding the people in their firm.
In my experience, some business owners will eventually decide (for whatever reason) that they wish to sell their company.
Instead of speaking directly with investors or prospective buyers, they will work through agents who will essentially put their firm up for sale and not much else — similar to an estate agency.
The issue is that small and medium-sized enterprises are not like houses. And selling a business is not the same as selling a home. In truth, negotiating the price is never the sole focus of selling a business.
Unsurprisingly, working with someone who simply focuses on the price and not every part of an exit (such as optimizing the valuation in the first place) will, in my judgment, backfire.
Here are a few things to ask yourself as an owner, before speaking with anyone about selling your business.
📌 Is the business ready to sell, or do you require assistance in preparing it to sell?
📌 Would the company fail if you didn’t stay around?
📌Are you emotionally prepared to sell your business?
📌 What is the true motivation for contemplating a sale? Is it due to retirement or an issue that the business is unable to resolve?
📌 Do you want to invest and grow or exit (or both)?
📌 Have you spoken with the right people who understand how to maximize your company’s valuation?
📌 How long would it take for a new owner to see a profit at your valuation?
📌 Would the future owners protect the company and legacy you leave?
