The timing to sell your business is a key part of an exit preparation plan
In working with clients to help them prepare for their future euphoric exit event, a key part of the discussion and planning relates to the “when” should they consider selling. At the highest level, there are two options related to exit timing. The first is obvious and that is as the company owner, when do you want to sell your business. The second is less obvious to many owners and that is the timing to sell your business related to when acquirers are most active and interested in buying your company. In the perfect world, you sell when these two intersect. Meaning, you sell when you are ready personally and it happens to coincide with acquirers being the most active acquiring companies within your industry. But for most sellers, these two often don’t coincide.
Our advice to clients is you should build a business that is ready to exit when you want or when the right acquirer comes knocking and is ready and able to reward you with a premium offer. You want to avoid being that seller that regrets missing the cycle of acquirers being active but didn’t sell because you weren’t personally ready to part with your company. Then the day comes you are ready to sell only to find that acquirers are not as active and certainly not paying the premiums they once did.
In your exit planning, give quality thought to the timing both as it relates to your personal desire but also monitoring the cycle of acquirer activity in your industry. Timing of your exit can mean the difference between a euphoric exit for you, your family and shareholders or one that is less rewarding.
