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Putting up that For Sale Sign

Selling your business is NOT like putting up a “For Sale” sign on your front lawn.

It’s more akin to putting your mature child up for adoption. Gut wrenching, highly emotional. Fearful. Permanent.

You likely built your business from scratch. You survived the startup years as no doubt there were rough stretches and economy – wide recessions. Your business grew and created wealth for you and your family, your employees and city, and many jobs created in your community.

No, it’s not at all like putting up a For Sale sign. In selling your home, you must first decide your price and who will help you sell it. You can do a “FSBO” (for sale by owner”) or you can sell thru a realtor. Of course, realtors will tell you that it always pays to hire a realtor to sell. FSBO’s get less attention and lower sale prices they say. Most homeowners don’t attempt DIY for their residential property. It’s just too risky for the very high stakes involved.

What’s higher stakes for you personally than your business? Nothing of course, it’s your prime source of retirement income. So, am I pitching for you to hire a business broker to sell your business? Yeah, I am.

But with the sale of a substantial business – let’s say several hundred thousands to many millions, or more, you actually require a lot more than just a sales agent to successfully market your business.

I strongly recommend that you create a small but properly qualified team to assist you – with that team including a business broker, your deal-savvy CPA #accountants, a financial advisor if your CFO is not experienced in deals, and – here it comes – a well-qualified business attorney. Yes, I am one.

“Qualified” means expertise (technical legal knowledge & skills) + experience (an attorney that does lots of sales of big & smaller businesses) and capacity (lawyers, students, clerks with capacity to do your deal, now). Not all CPAs or lawyers are deal-savvy. Generalists are obsolete in today’s fast-changing business world. You might have to “shop around” or conduct a “beauty contest” to flush out the best choice of team members. And do I need to say, “Price isn’t everything”, and “You get what you pay for”?

Here’s an off-the-cuff list of a few attributes or skills your team needs:

  • deal design and structuring experience
  • income, sales and corporate tax knowledge
  • negotiating, strategizing abilities
  • broad contract expertise over many areas – HR, P, commercial leases, debt instruments, insolvency, corporate finance & securities (options, preferred shares vs common shares, shareholder loans, preemptive agreements, voting trusts, shareholder #agreements, and so…).

Do you have those covered off on your own? No one does. Smart owners rent, not buy, the expertise and experience they need. Would you believe me if I said that the financial value of a qualified broker, CPA and business attorney always exceeds their respective fees to you?

Trouble is, you only have one chance at selling your business.

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