Time for a Change? Ask Yourself These 4 Questions Before You Decide to Sell Your Business

It seems like only yesterday that your business was a tiny but promising startup. Now you’ve received an offer that reflects how much the company has grown, along with its value. The prospective buyer is offering enough money to fund the next stage in your life, whether that be retirement or funding another business, but is now the time? Is this the right move for you and the company?

Below is a list of four questions that you should ask yourself before you sign that contract.

1. Can the company succeed without you?

Many owners are the sole reason for their company’s success. This tends to be the case when you have a strong personal brand and a client base that you built up yourself over the years. If you’ve been the face of the business since it started, can it survive without you?

If the answer is no, now may not be a time to sell. Start preparing an exit strategy that allows key members of your team to assume your current roles and responsibilities. Once they do so successfully, you can think about moving on.

2. Are your affairs in order?

This question is an extension of the first one. There’s more to a successful and self-sufficient business than impressive balance sheets and financial statements. Are all leases, licenses, and permits in order? Are your vendor and customer contracts up to date? Are there any outstanding debts or legal issues? Nothing can derail a sale or cause future problems faster than problems that could cause issues for the buyer later.

3. Who is the buyer?

Who is the person making the offer? Buyers can be existing employees, companies looking to expand into your market, and even competitors. Whoever they are, do they have a sound strategy for taking the company to the next level? 

Others may tell you that unless you retain some interest in the business after you leave, its fate is technically not your concern after you leave. But when you’ve invested so much of yourself into making the company a success, you probably don’t want to leave it in less than capable hands.

4. What will you do after the sale?

You spent a lot of time building your business and turning it from a promising idea into a tangible financial asset. Over the years, the company becomes an extension of you: a symbol of your energy, creativity, and passion. What will you do after you sell?

If you know what avenues you’d like to explore after the sale, now may be the time to pursue them. If you don’t, you may regret the sale and/or jump feet first into a new venture that may or may not be appropriate for you. Take some time to think about your future plans before signing on the dotted line.

If done under the right conditions and for the right reasons, selling your business can be the perfect end to one chapter in your life and the beginning of another. By answering these four questions, you’ll increase the likelihood that you and the buyer will enjoy future success.

At Soterian, one of our missions is to help business owners determine whether it’s time to embrace their next challenge. To learn more about the Soterian Process of Finding Your When, click here to schedule a time to discuss how we can help!

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At Soterian, our goal is to help business owners like you think bigger. Bigger than today, bigger than your business, bigger than yourself.
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