The decision to sell a business isn’t one that you make overnight. Business owners can take months to come to the recognition that it’s time to sell. Sometimes no one reason and no single cause stands out. Capital sees the same common reasons from business to business, here are six signs you are ready to sell.
1. The business can survive without you
Building a business means pouring your heart and soul into the company. A business is a reflection of the owner’s experiences, priorities and principles. Over time, the business itself comes to inhabit those values.
At the same time, you have a solid team in place. Delegation allows other people to make important decisions. Your input, crucial at the start, is no longer key to the survival of your business.
If you have become surplus to requirements but can’t avoid meddling and unfilled hours fill your day, you may be ready to sell your business.
2. The business needs fresh leadership to grow
Founding a business means creating, building and growing a successful machine. You feel that you’ve taken it to your limit and fresh skills or experience are required to get to a higher level.
It's time to bow out and hand the reins over to someone else to grow the business, you're ready to sell. They can look at new directions and markets that could expand its potential.
The challenge for you is accepting the facts.
3. You’re burnt out
It’s common for entrepreneurs to work long hours for years, investing time and energy and taking advantage of that initial buzz.
Your enthusiasm fades over time. Your evenings and weekends mean more than your business. It’s not a bad thing. It’s a natural process after the dizzy heights of the first few years in business. There’s nothing wrong with needing to reduce the amount of stress in your life.
You owe it to yourself – and to your people – to allow someone with renewed vigour and drive to take over. Don’t be the one to kill your business.
4. It’s time to take the money
A business exists to make money. Business involves risk and danger, especially to the owner. Opportunities to sell are rare but risk is constant. A business is also illiquid apart from what you draw in income and benefits. The key is to know your ‘number.’ Then when opportunity knocks, you can exit quickly on your own terms.
5. It’s time for a new challenge or a new chapter
You believe you have a rewarding chapter ahead, perhaps thoughts of starting a new business or following other dreams. Having spent years building a business, you want to take time out, to live on the fruits of your labour until the new challenge comes along.
Realising the financial value from your business should give you the capital you need or the financial independence to pursue the leisure activities you’ve been putting off.
Find your new spark. Don’t live in the shadows of your old life.
When you started your small company you were full of confidence. A risk-taker. There wasn’t too much to lose, business-wise. Over the years your business has grown, and so has the value of your business. That value needs to be protected. Big risks and gambles are out. You don’t have the years ahead to fix things if it all goes wrong. You are in defence mode. The business will begin to stagnate and lose attractiveness to potential buyers.
At Capital, our chartered financial planners are experts in helping business owners. Our experience can help guide you through the process of ensuring a pain-free and successful sale. Your Capital financial planner will help prepare you for post-sale life and support you in the process of selling your business.
If you would like guidance on selling your business and discovering the financial amount you need from your sale to live your desired lifestyle, contact us.