If I sell now then I will have to retire or find another job.
Selling Business Myths – Part 7
You’ve just sold your business. Congratulations!!! Now what? Ok, hopefully you and your Investment Banker have worked something out prior to even taking your company to market. It’s a big decision and luckily you have many options. If you determine what YOU want on the front end then it will drive the sales process.
Should I stay?
• I add value to the sale: As a key part of your business over the years, you could offer tremendous value to a sale if you stay in place for an extended period of time. Often buyers want to be investors in a deal and not involved in daily operations. They may need you to stay just where you are and continue involvement.
• Keeps me in steady income: For the reasons stated above, you may be asked to stay on. This may be a good opportunity for you to put away that up-front cash from closing and then continue to draw a salary as an incentivized employee of the company.
• Keeps me busy: Maybe you aren’t ready for the golf course yet. You still want some level of involvement in the company. Post sale, a Consultant position or something closer to full time could be a good opportunity to stay active.
• Transition the business: Maybe I could stay, but just for awhile. Actually, this transition period is the standard in almost every transaction. Most transition periods are from 3 to 6 months, but can be longer or shorter based on your needs, and those of the purchaser.
Should I go?
• Retirement is calling: You have been ready to retire and your mind has been sailing around the world for years already. Now you can comfortably do so without the responsibility of a business at home.
• The next opportunity is waiting: You have identified the next opportunity and want to get it started. If you have another business in the wings, you will now have the capital to go out and get it done.
• I don’t fit in, or am not needed: If there isn’t a logical place for you after sale, then it’s time to move on. You may have done such an excellent job of procuring talent and training your people that the business will comfortably transition with new ownership.