Selling a business can be one of the most significant decisions in a business owner’s life. It’s not just about the financial gain but also about preserving the legacy you’ve built, ensuring the well-being of your team, and finding the right buyer. However, the process can seem overwhelming, leading many to procrastinate. Gregg Kunz, author & expert business broker’s new book, “Lucrative Exits,” aims to demystify this process and provide a clear, actionable roadmap for business owners.
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INTRODUCTION
Envisioning Your Successful Exit
Most business owners’ dreams revolve around reaping the most from the business sale with minimal effort and disruption. Understandably, the prospect of selling a business often feels like a huge undertaking, causing many to delay the start of the preparation process. This procrastination becomes a barrier to a timely and successful exit on your terms.
You must realize that selling a business isn’t just about monetary gains. It’s also about caring for your team and loyal customers and upholding the legacy you’ve tirelessly built. But, there’s a gap I’ve noticed: most business owners struggle with visualizing a successful exit. They go from the present, sitting behind their desk to lounging on a sunny beach or enjoying a well-deserved retirement. Trust me, there is plenty to do to leap from your desk to the unencumbered freedom after your exit.
When you first started your business you understood that it would take effort and focus to build a successful company. Your success did not happen by magic, and it is the same with preparing for your exit, except one thing: it’s a lot easier!
So, what’s stopped you from taking that leap? Two reasons frequently come up. First, if the thought of selling in the next five years hasn’t crossed your mind, this presumably monumental task might get buried under an already lengthy to-do list. Second, many operate under the misconception that prepping for a sale is overwhelming. Through this book, I hope to debunk this myth and show you that it’s much more straightforward than you imagine.
First things first. We are going to talk about the sales process and the decision to sell – this does not mean that you will sell next week. It means that you have made the decision to sell at some point in the future. Today I want you to make the decision to sell and to use the coming days, weeks, months, and years to begin preparing. When the time finally arrives you will be glad you heeded my advice.
It’s okay to admit that selling your life’s work can be a bit terrifying. Over the years, I’ve recognized common fears business owners grapple with:
- Confidentiality Concerns: Will my team find out? What if my loyal customers move away, fearing instability? And what about competitors?
- Business Disruption: What changes will the selling process bring? How will it alter our daily operations?
- Financial Outcomes: Will the sale provide enough for the next chapter of my life?
- Loss of Identity: You’ve been at the helm of your business for years, maybe decades. Who are you without it?
When it comes to these fears, recognize them, address them, and remember that emotions play a significant role in this process. Logic, strategic thinking, and focus can help navigate these choppy waters with the proper guidance.
Sometimes, challenges come not from the owner’s fears or the market but from within your circle. Unwilling partners or family members can pose significant obstacles to a smooth sale. Multiple stakeholders mean multiple emotions, and this can complicate matters.
Transparency is the solution. As a business broker, I meet with all stakeholders, explaining the process and addressing concerns to help find common ground. And sometimes, bringing in third parties, like financial advisors or exit planners, can offer clarity, help align interests, and get all stakeholders on the same page.
Your Questions Answered
Throughout my years of practice, I’ve been asked countless questions. If you are considering selling your business, you probably wonder:
- “How much is my business worth?”
- “How long will the sale process take?”
- “What are the tax implications of the sale?”
- “How do we ensure confidentiality during the sale process?”
- “How can I get the highest sale price?”
Some questions aren’t for me to answer, like gauging if the sale proceeds will support your lifestyle. However, a competent broker should confidently address common concerns after an in-depth, honest, and objective discussion of your goals. Business brokers are at heart also problem solvers. They do not have all of the answers but good ones should be able to call on their trusted network to provide you with the professional expertise who can answer your questions and temper your fears.
Many business owners approach the sale with a degree of suspicion, especially toward brokers. It’s a fear I’ve encountered often: “Will the broker truly prioritize my interests?”
While some newer brokers might focus on quick sales to cover their bills, seasoned brokers know the value of building relationships, adhering to process, and keeping the client’s timeframe first and foremost. Properly pricing a business and ensuring a smooth transition takes precedence over rushed, poorly conceived transactions.
My journey from the corporate world, being at senior levels where every detail mattered, has instilled in me the importance of preparation. I’ve been a business owner three times over, and I’ve tasted both the bitterness of getting less than I should have and the sweetness of a high-value exit. This first-hand experience allows me to understand the nuances and challenges of the sale process, ensuring a smooth transition for my clients.
Since I handle the intricacies of selling, my clients can be 100% focused on their business operations during the process. Some owners will take their foot off the gas, thinking, “Oh, now that I’m selling, I don’t have to work as hard.” That’s the death knell right there.
I believe in thoroughness. My documents provide comprehensive information about the business. These aren’t just a reflection of the business; they’re a reflection of the broker. A half-hearted job gives a poor impression of both.
Our results speak for themselves. We sell better than 90% of the businesses we bring to market. Is it because we’re magicians? No. We focus solely on great businesses, not perfect businesses, and not businesses without blemishes. But we understand the imperfections. Any of these can become objections or obstacles in the sale process. We identify them and formulate solutions early in the sale process so they don’t become deal stoppers. Identifying and addressing potential roadblocks ensures that when speaking with a prospective buyer that the broker and seller are perceived as credible business people, not salespeople.
My clients appreciate that I don’t sugarcoat the facts. I strive to tell business owners what they need to hear rather than what they want to hear. Is it painful at times? Absolutely. But if your broker leads you to believe that everything about your business is great, it’s probably time to consider interviewing another broker.
In the following chapters, I’ll share strategies and insights into business selling, covering topics such as:
- Sale preparation
- Building an advisory team
- Valuation
- Finding the right buyer
- Marketing strategies
- Negotiation tips
- Financing
- Closing the deal
I’ll also include plenty of anecdotes and tips that I have learned along the way.
Life Beyond Your Business
Most business owners embarked on their entrepreneurial journey with a vision. That vision becomes their destination. Over time, they find that their reasons for diving into the business world have been realized, and a new chapter awaits them.
Whether it’s retiring with dreams of traveling, spending time with family, or even pursuing an entirely different direction, like returning to school, the financial freedom from a successful business exit provides the runway to make those dreams a reality. Despite making a great income, I once had a client who desired to completely disengage from his business to indulge in his dream of playing golf every day without any distractions – including even minor and infrequent calls from the office. His dream was to be entirely out, and he trusted our firm to make his dream a reality. Success is relative to you and you alone, as are your goals and dreams. Everyone’s interpretation of success varies.
One clear distinction I’ve observed is between those running from their businesses and those running towards a life they’ve dreamed of. The latter usually realize significantly more value from their exit and their dream becomes their reality.
Having been in the business owner’s shoes, I’ve painfully experienced the lack of guidance when I made my decision to sell . I ventured into this book to bridge that gap for others. The transition from business to the “feet in the sand, drink in hand” dream isn’t as straightforward as many perceive.
By following the steps in this book, you will have a more rewarding exit, and your business will thrive in the interim. You’ll enjoy better sleep, longer or more frequent vacations, and more free time. Ultimately, instead of being consumed by your business, you’ll control it. Ready to make that shift? There’s plenty to do; let’s get started.
Authored by Gregg Kunz
Get your copy of “Lucrative Exits” by Gregg Kunz today and start your journey towards a more rewarding future.