4.23 Review Tips For Creating Options and Making Sure You Sell Well
1. Not sure where to start, get a qualified team. Engage experts in operations, finance, sales & marketing, human resources, legal and wealth management. Make sure they understand what is needed to exit a business successfully.
2. You need to be irrelevant. Stop working in the business and start working on the business. Pull away from the day to day responsibilities and spend quality time looking at the present and future of your industry and your business.
3. Only do what you love to do. Get back in touch with why you loved building your company. Re-energize yourself and enjoy the journey. You won't feel as pressured and wind up making the wrong deal.
4. Fix the broken stuff. People, systems, finance etc. Often it is the unwillingness of you the Owner to make the tough decisions that will be your downfall. If it walks like a duck and talks like a duck it won't fix itself, or it would have already.
5. Get your sales and marketing updated and aligned. Make sure they're working in an integrated effort. Good sales and marketing are key to your success.
6. It's not just about great sales numbers. Great operations and strong financial controls deliver profitability and desirability as well.
7. Add at least 3-5 years on to your exit strategy. After you make the company desirable you need to find a Buyer. Count on another year to do the deal and 3 more to ease your way out. The new Owners will likely require your participation to provide experience, industry introductions, continuity with staff, vendors, and customers.
8. Not sure when you want to exit? Run improvement efforts parallel to the process, as you don't know how long it will take and you just may change your mind.
9. Create options. It's not always black or white, selling or closing. Sometimes you just need to develop options. There are many ways to structure a deal. Talk to the experts on your transition team. Create optional scenarios for structuring a great deal for you. Take into account both business and personal requirements with regards to timing and money.
A Final Thought
Selling or transitioning your business is a big step, both personally and professionally. Surround yourself with good people. Make a plan and anticipate there will be changes all the way through the process.
You will experience many highs and lows, much like you have for the last few decades while running your company. So nothing new. Look at it this way. You've been training for this next step in your life for years.
At the core of this process you should remember to focus on the positive, increasing the value of your company. Not the negative of leaving your comfort zone. If you do it right you'll have options. If you change your mind you'll have a better business. Either way it's a win win for you..
Exercise - Quick Checklist Before You Go To Market
1. Not sure where to start, get a qualified team.
Team Members Name, Contribution, Inside/Outside Resource
2. You need to be irrelevant.
2.1 Are you completely out of the day to day and yearly planning?
2.2 What else do you need to do to be out?
3. Only do what you love to do. Are you doing what you love to do everyday? Work or play.
3.1 List the tasks you love to do.
3.2 List the tasks you dislike.
3.3 Identify resources inside and outside the company to take on the disliked tasks.
4. Fix the broken stuff. Are the broken pieces fixed and running properly?
4.1 What is still to be done? Who will do it?
5. Get your sales and marketing updated and aligned. Is this done?
5.1 What more needs to be done for sales? Who will do it?
5.2 What more needs to be done for marketing? Who will do it?
6. It's not just about great sales numbers.
6.1 Are Operations running optimally? If not what needs to be done and who will do it?
6.2 Is Finance running optimally? If not what needs to be done and who will do it?
7. Add at least 3-5 years to your exit strategy.
7.1 Talk to your Intermediary and arrive at an ideal exit timetable.
8. Not sure when you want to exit?
8.1 List the improvements you could make to the company while you are in the selling process.
9. Create optional scenarios for structuring a great deal for you. Take into account both business and personal requirements with regards to timing and money.
9.1 Business timing and money high level 'at 30,000 feet' requirements.
9.2 Personal timing and money high level 'at 30,000 feet' requirements.