Exiting your business is inevitable. Whether you find something more enticing that pulls you toward its direction, you’re looking to shift gears, or you’re preparing for retirement, sooner or later you’ll have to hand over the keys to your company to somebody else.
Being settled and at peace with this reality can be a struggle. Most business owners looking to exit are well prepared for leveraging buyers to ensure a fair offer is made. But if you were to survey people who have sold their business, you’d discover that financial considerations make up just a small part of ensuring happiness following an exit.
There’s no question that money is good – and important. However, it’s not what’s going to keep you happy once you say goodbye to something that was an enormous part of your life.
In order to ensure happiness following the sale of your business, you have to be prepared to endure the emotional aspect of this transition.
Make sure you come up with a solid exit plan
Before you launched your business, you likely drafted a comprehensive business plan that outlined the goals and expectations you intended to meet over the course of many years.
You should approach your exit strategy in the same manner. While golfing and vacationing seem like the perfect way to reward yourself for all the hard work you’ve performed in your career, you’d be surprised how unfulfilling that lifestyle can be.
Those who are blessed with an entrepreneurial spirit are happiest when they’re involved in projects; when their skills are put to good use. It’s what kept you coming to work each day. So, before you look at the sale of your business as an opportunity to sit back and relax, you may want to consider figuring out what you want to do for an encore.
That means spending a considerable amount of time planning for your exit. Far too many business owners wait until an offer comes, or a new opportunity is revealed, before they plan their exit. But those who have found the most happiness following their sale did so because they spent years preparing for that very moment.
Planning your exit strategy
1. Know your intentions
Understanding that the most successful exit strategies are years in the making, the first thing you should consider is becoming aware of who you are, and what your intentions are by selling your company. “Because the right offer came along” may seem like a viable motive now, but it won’t be of much worth for you a few years down the road when you’re unsure what to do with your time.
Why is it you want to exit? Is it because you’ve done all you can do with your business? If so, perhaps it’s time to look toward a new adventure that tests you in different ways.
Is it because you’d like to commit more time toward worthwhile causes? Rather than say you’ll do more to help others, come up with a plan on how you’ll make that happen. Perhaps you’ll create a new startup, or you can offer your expertise to young entrepreneurs. In other words, don’t just wish for a post-sale life – put a plan into place to ensure it happens.
2. Make sure your company is sellable
While finances tend to make up a small portion of ensuring happiness post-sale, money is still an important part of the transaction. In the years leading up to your exit, make sure you take the proper steps to ensure that when the day finally arrives, you’ll be able to sell your company on your terms: when you want, to whom you want, for a price you believe to be fair.
3. Find outside support
Not only should you look toward bankers and financial planners for support on how best to exit your company, but you should also turn to people who’ve actually gone through this process. They can help you prepare for the realities of life after your business.
4. Be at peace with what happens with your employees
This area can be the source of a significant amount of stress and heartache following a sale. How can you find peace with whatever happens to your employees once you leave the company?
For starters, it gets down to trusting the new captains of the ship, and that comes down to understanding why your potential buyers are looking to purchase your company. Well-crafted contracts designed to protect your employees can only go so far. The best way to ensure the security of your employees is to choose a buyer whose intentions you can get on board with. Again, this goes back to investing a few years into your exit strategy, rather than a few months.
Avoid losing your identity
One of the biggest sources of unhappiness following a sale is the loss of identity. You put so much of your life into your company. It’s perfectly natural – and expected – that you’ll grieve its loss when it’s gone.
The people who have successful exits not only expect and prepare for this mourning period, but they also put a plan into place to help them reestablish their identity in a new realm. Keep in mind, while it’s important to be rewarded financially for the success of your business, you’ll need more than just dollars to find happiness once you say goodbye to your blood, sweat and tears.