Myth: It’s All About the Money When Selling a Company

Important questions are raised when selling a company. What do you want to result from the sale of your company? How is the sales process impacted due to this? And how are you going to figure it out? It is a myth to believe it’s just about the money.

Once given the time to reflect on them, your goals are broader than financial ones, and extend beyond just you. What are the goals for everyone: you, your family, your business, your employees, and other stakeholders? As we’ve often said to our clients and colleagues, your business is more than a paycheck; it is a source of pride, purpose and relationships. It hasn’t been solely about the money when you worked there, and it won’t be when you sell a company.

To successfully sell a company means a considerable change on many levels. Transitioning away from the business is a voyage from the known to the unknown, and it should be considered with more than just a fleeting thought. What is your destination? What are you hoping to achieve by selling? Who must be part of this planning process? Understanding your business, financial, and personal goals is critical to your sale having a successful conclusion as you define success.

Typically, however, business owners define their goals only financially — receiving the highest price with the lowest taxes at closing, or maybe creating a future income stream. With all due respect to the art and science of business valuation, coming up with a dollar goal is comparatively simple. Another aim could be to sell a part of your business or the whole. Or it could be to maintain control and finance growth through recapitalization.

When assessing your financial needs, risk tolerance, and many related matters, you do need to think long and hard. What are the requirements of other stakeholders and family members? Are they on board with the plan of the business being sold? Is it important to cash out at closing, or would you consider maintaining a small investment in the newly sold company? And what is practical? Everyone has a financial dream, and whether the market supports yours or not will be discovered in time.

Business owners have told us many times that their goals are bigger than just money. Money is essential to them, but it is not the only essential thing. Just as their business means more to them than money, so does its sale. They want it done well, but struggle to clarify what that meaning is and what their objectives are.

Clients we’ve worked with often at first define the sale of their business in terms of money because they haven’t taken time to think more about the bigger picture or don’t know how. When we work with them, we help them to consider the broader scenario: the best-case picture of their future—meaningful engagement with the world through work, family, activities, charities, adventures, spiritual and community commitment — after the sale.

After all, selling is a chance to redefine your life. It is more than just the money. Who will the new you be? What will the new you do? We’ll outline supportive questions in future articles to lead you through this process of self-discovery.

Answers to these questions will impact the kind of buyer and transaction you look for, and become the foundation for your selling strategy. A good starting place is by knowing, in broader terms than money, your definition of success that works for you.

I invite you to use these ideas to create your best-life business exit strategy.