Reasons to Sell (or Not to Sell) Your Business

Ellie Green
Authored by Ellie Green
Posted: Friday, November 12, 2021 - 21:00

Building a small business is a difficult, but often rewarding, way to spend your time. There may come a point, however, where you feel that you’ve taken a given venture as far as you can, and that it’s time to move on. This is where you cash in with a sale.

Selling a business isn’t much like selling a lawnmower, a car, or even a house; there are many moving parts, and potential sticking points that can potentially scupper the entire thing. You’ll potentially need to enlist the aid of brokers, accountants, and lawyers throughout the process. In many cases, knowing when to sell your business will depend on the advice of impartial outsiders.

While the process is ongoing, it’ll take up a large amount of your time. Plus, once it’s done, you’ll have the (admittedly enviable) problem of deciding where the cash needs to be distributed.

The Value has Peaked

At a certain point, it’ll become difficult to grow your business any further. What’s more, the bigger and more complex the business gets, the greater the chance of failure, and the more disastrous the consequences when that failure occurs. If there’s a chance to bring additional liquidity into a venture by selling part of it, then it should be considered – especially if you’ve over-expanded, and need to rid yourself of parts of your business that aren’t performing as well as hoped.

Risk Fatigue

Owning a business can be stressful, because it involves constant exposure to high levels of risk. The larger the business gets, the larger the risks become. If you’re early in your career, then the excitement that comes with these risks might be worth it – but as you get older, your priorities in life may shift. You might lose your appetite for new ideas and new ventures, and find yourself yearning for something more straightforward and secure.

The Time is Right

Throughout the lifespan of a business, you’ll naturally come upon points where it feels right to depart. You might think of these as rest stops in between different legs of a longer journey. Rather than find yourself wanting to leave further down the line, at a point where a sale would not be opportune, you can get off at one of these natural stopping points.

The Offer is Good

Ideally, you’ll have a strong idea of the value of your business throughout your stewardship of it. That way, if an especially generous offer comes in, you’ll know in advance just how good it is. You should also have worked out exactly how much you’ll need to make in order to either retire, or plough the proceeds of a sale into a new venture.

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