Business owners embrace and endure a long, laborious journey for the opportunity to forge their own path, pursue their passions, and hopefully gain financial freedom. Beyond a sense of personal accomplishment, the greatest reward often comes in the form of a successful sale transaction, potentially the most important financial event of a lifetime. The liquidity event associated with a transaction can impact nearly every aspect of one’s financial future.
When initially considering a transaction, it is important to understand why. Are there issues with succession? Are you looking for growth capital? Is there a change in the competitive environment? Is it purely to create liquidity for generational wealth for your family? Capturing value from a transaction goes beyond just maximizing the sale price and your strategy should be informed by your priorities.
As you prepare for an exit, focusing on five key areas can help ensure that the transaction serves your long-term goals. This process involves treating the sale as part of a larger financial strategy, not an isolated event. With proper planning, selling your business can be a moment that simplifies – and clarifies – your financial picture and can provide greater freedom for you and your family.
Since these areas of responsibility can often overlap, active communication among team members is essential. As a seller, you want to ensure that your team is properly coordinating, not just to close the deal, but to ensure the terms are aligned with your personal objectives.
Depending on the specific business and circumstances, we believe that business owners can achieve more favorable outcomes by hiring independent professionals in most, if not all, of these disciplines. This approach allows owners to utilize best-in-class advisors in each category and to benefit from different perspectives in the transaction, both objectives which are difficult to achieve with a one-stop shop.
