How To Sell Your Business To An Absentee Owner

Most absentee aren’t drawn to a business because they have a passion for it or want to change the world. They’re attracted to the money, plain and simple. The better your cash flow, the more likely you are to appeal to absentee owners.

Along the same lines, absentee owners will expect a strong return on their investment, whether they earn that by cash flow or increasing the value of a business and selling it at a later date. If, for some reason, your business is currently “undervalued” and has the potential to become worth a lot more if changes are made, this scenario could be alluring to absentee owners.

For a business to virtually “run itself,” (which is the dream of most absentee owners), efficient systems and operations need to be in place. This can include recordkeeping, financials, policies, procedures, best practices, proprietary processes, and more.

Because absentee owners have little desire to be in the business on a day-to-day basis (or at all), it’s imperative that your key employees agree to stay after you’ve sold the business. Having a solid management team in place (and potentially under contract) will score points with absentee owners.

If you’re willing and able to stay involved with the company after the sale, you could entice a larger pool of potential absentee owners. There’s a good chance that an absentee owner won’t know anything about your business or industry, and who’s more qualified to train them than you?

Absentee owners often seek out “simple” businesses, ones that are easy to understand, easy to run, and easy to hire for. Think liquor stores, storage facilities, e-commerce sites, and the likes. Even if your business doesn’t fall in a category that’s typically regarded as simple, don’t worry. If you have great systems and processes in place, key employees who manage everything, and a healthy cash flow, it will seem simple to a wide range of absentee owners.