Getting to Day 1: Selling your business

Getting to Day 1: Selling or transitioning your company

This topic first came to my attention when my father talked about selling his solo-practice dental office. The long and short of it is that he was a fantastic dentist, and a good small business owner, but has no idea how to sell his business. No fault, no knock on intelligence or personal ability, it is a knowledge and experience issue.

I am now seeing this issue with other family businesses.  My mother’s company, mid-sized and solo-owned, has been 2 years away from selling for almost 15 years now. I have an ownership stake here so I’m motivated on this topic. And now my Uncle, the owner of a business with appx. 30 employees. All are seeking my help as a sounding board, educator, as well as a facilitator.

Then just last week I answered and AVVO question on the same topic.

FYI: My thesis for law school was on the subject of transition plans in private vs. public companies.

After your family, education, and home, your business is probably the next most valuable asset you have. If you are a solo-owner this might be your entire retirement fund. With that price tag, it is important to remember the grand old phrase: “Hope is NOT a Strategy.”

I’m certain I’ll write quite a bit more on the subject over time. However, this is a ‘Getting to Day 1” article. So here is what you should focus on first:

  • Your definition of success;
  • Your walk away price;
  • Your hopes and dreams price;
  • Date when you are ready to accept an offer;
  • Date when you want to have an offer by;
  • Is the business understandable to an outside party;
  • Do your products, procedures, clients, and accounting make sense;
  • Are you emotionally ready to walk away; and,
  • Who do you have that can help? Are there consultants that you need?

These questions should lead you to a concept of what you are doing, why, and what the expectations are. The actual “Day 1” is to have your business in a state of preparation where you can actively find a buyer.

It needs to be said that ‘hope is not a strategy.’

But hey, what do I know?