If I'm selling my business, what emotional struggles should I prepare for?
Some startups sell within a few years of inception while most family/founder owned businesses are held decades before a sale occurs. During this time of ownership, many personal relationships are developed, trials and tribulations are shared with customers and vendors, milestones are achieved by employees, families grow and prosper under the owner’s direction, loss of key stakeholders – the list goes on. Business ownership comes with many highs, many lows, and everything in between which results in a very unique experience – one that only other owners can appreciate. As a result, the reality of selling one’s business comes with a lot of trepidation, mental exhaustion, and introspection. We have found that many owners recognize a sale or succession plan is imminent; however, few take the time to properly plan and prepare the business and themselves for a transfer of ownership.
Commonly, it is the fear of the unknown that paralyzes many owners. To help steady the waters, we recommend owners proactively prepare for an exit and take time to position the business for a successful transfer, understand the sale process, and engage advisors ahead of embarking on the journey of selling. Things will move very quickly once the ball gets rolling and there won’t be much time to process critical decisions, much less one’s emotions. The due diligence process is very demanding, and stressful as owners attempt to juggle running a business, responding to auditors, and navigating complex legal documents. Experienced advisors will help manage the process and hold the hand of the seller along the way.
While the sale process and due diligence period is a challenge, it’s the reality of selling the business and handing the keys over to new ownership that takes the greatest toll on many sellers. In essence, you’re giving up your life’s work and purpose which can be a hard pill to swallow. Some sellers find solace in staying active in the business upon a sale, either in a board level position or in full-time leadership roles. Others have the next chapter of their life mapped out with travel, exploring new hobbies, spending time with family, volunteering, etc. Again, planning ahead and having a strategy in place will help normalize the emotional swings that come along with selling a business.
Business Acquisition & Merger Associates (www.buysellyourbusiness.com), a Charlotte, NC advisory firm, assists business owners in growth recapitalizations, business transfers to financial or strategic buyers, and management buyouts. BAMA also helps companies grow by providing buy-side sourcing services that identify potential add-on acquisitions to expand geographic footprint or add strategic products and capabilities.