Selling your business is often the first step toward the rest of your life. Every entrepreneur starting from scratch has dreamt of the day he can escape to that safe haven, that respite away from the bustle. Selling is often a form of saying goodbye, and for some that means severing ties that long represented an intellectual and emotional attachment to ideas you helped to create and implement. Rich Krebs, a financial sales advisor working with mergers and acquisitions, spoke with Forbes magazine to shed light on some factors that contribute greatly to the fruition of a sale, but may be forgotten or neglected in the commotion. Here are some tips to ensure a smooth sale:
Offering a separate negotiation for cash payouts may open new doors. Buyers may take kindly to a discounted offer if paid in cash. It can be cleaner than leveraged buyouts in which equity and collateral serve as buffers to the cost which cannot be paid directly in full and up front. Cash offers can often be a win-win simplification for both parties.
Krebs suggests hiring additional specialists—lawyers and accountants— to comprehend the great amount of compliance material necessary to know in a complicated transaction. While many businesses have in-house lawyers who are markedly prepared for such an event, additional help will ensure that everything is up to speed, and up to par with standards.
Be prepared to make changes and move on
If this is no longer going to be your business, you must make sure the personal components are disassembled. Firstly, that means maturely facing the truth that a creation of yours has seen its best moment under your watch, and it is time to end your very personal connection to the company. In doing so you distance yourself from the history of successes and failures, and accept those stories as an unforgettable part of your past.
Buyers prefer to see open houses, looking to fill in the chinks they see in the structure. This means new hires and fires. What you can do to help clean is let go of the inefficient, be it an employee or a systematic element of the company. In any case, a company should not suffer a drastic change in productivity because you, as its head, leave. It is up to you as the seller to make sure due diligence does not reveal any kinks in your business. That will result in a reduction in the sale price.