Your personal readiness is as important as your company readiness
You might be surprised to learn that it’s not uncommon for acquisitions to grind to a halt and even get derailed because the seller learns too late that they weren’t prepared personally to sell their company.
Private business owners think in terms of making sure their company is prepared to attract and excite a third party buyer but too often don’t invest the time in the preparations that need to take place for the company ownership to be personally ready. Ask yourself these questions as you prepare yourself personally for selling your business:
- Today my day and week is filled with meetings and activities related to my business, so what does each day look like once I no longer am responsible for my business….will I get bored quickly or do I know specifically how I will replace the time not just weeks after a transaction, but years after?
- You know what your typical calendar and schedule looks like today as you own your company, what will your calendar look like the day after you sell your business and do you like how that calendar will look?
- Today, when you meet someone new at an event or a dinner party and they ask you what you do, you reply that you own XYZ business. Once you sell your business, how will you convey what you do? Will you convey “I sold my business and now retired, I sold my business and now manage my investments, I sold my business and now focus on philanthropy activities, etc., etc.”
- Today your business most likely provides you mental stimulation and challenge, if you like this aspect of your life how will you replace this once you no longer own your company?
- How will your “new life” post selling your business impact your family, a spouse? Today they have their life and routine, how will your change of routine affect them?
- Upon selling your business, you won’t have a paycheck from your business so your cash flow for paying monthly bills will change and even access to your health benefits will change, have you thought about how both of these will be replaced?
These are just some of the questions we help our clients think through as they invest the needed time to prepare not just their company for exit, but themselves personally as well. Achieving a euphoric exit event one day doesn’t just get defined in how much you receive valuation wise from a third party and the deal structure they offer but it also includes how you will personally feel after the transaction. Avoid putting these questions off too long because for some they can take a while to truly think through effectively.
