Selling a Business: The No.1 Lesson I Learned

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For most entrepreneurs there comes a time when you want to sell your business. You’ve pumped all your energy into it over time – and now you want to pass it on. 

I’ve spoken before about the importance of being vulnerable not just in everyday life but in business, too. And in sharing this with you, I’m being a bit vulnerable myself, which I think is important for gaining any value from others’ experiences.

It’s all about the real-life lessons I’ve learned in business and entrepreneurship – the mistakes I’ve made and the experiences I’ve gained from them.

And a lot of the time, it’s the hardest lessons that bring the most value.

One of the biggest lessons I learned in business

A number of years ago, I was selling one of my businesses and it taught me a few lessons.

Firstly, I quickly learned there are a lot of meetings involved in selling a business. A lot.

I was in one of these meetings going through all the finer details and at the end, one of my team members turned to me and said: “So what’s your key takeaway from this? What’s the biggest lesson you’ve learned from the process of selling a business?”

After thinking about this for a while, my key takeaway was this: if you’re selling a business when you want to sell your business – you’ve probably sold it too late.

What I mean by this is by the time you arrive at the moment of saying, “Yes, I want to sell my business,” your mindset is now going to be completely focused on getting out of the business, rather than building it up. 

It’s only when you’re feeling energetic and focused that the business thrives. As an entrepreneur, once you’ve reached the point of wanting to get out, you’ve already started detaching from it – whether that’s consciously or unconsciously.

Like the phrase “jump in with both feet”, you’ll have now taken your two feet out of the business to essentially ‘jump’ out of it. 

And when you’re in the mindset of getting out, this will negatively impact the business at a crucial time. No longer will it be as energised and lucrative as it was say, for example, a year ago, when it was your absolute passion. 

Don’t sell your business when you’ve already started mentally checking out from it. 

Instead, start thinking of selling at the time when you’re feeling most enthused by it.

 So, how long does a business take to sell?

Another thing I learned is that the process of selling a business can take quite a while.

The sale of a business is going to take on average six months to a year, depending on the size and circumstances. My experience is with small businesses, so that’s what I’m talking about here.

If you’re spending six months to a year detaching from the business and trying to get out of it, that declining sense of enthusiasm is going to have an impact on your business and, ultimately, its price tag.

We buy from people who are passionate about the things they sell, and it’s no different when it comes to selling a business. Create a sense of desire for your business and you’ll generate more interest.

How to handle offers to buy your business

Here’s a top tip: if you have a business where the endgame is ultimately to sell, you need to be working with someone to check the following:

  1. That the business is sellable
  2. To gauge the level of interest out there. 

Sit down with your accountants or financial advisor and say to them: “I’m building this business to ultimately sell. I’d love you to look at it and ‘test to waters’ on a recurring basis, just to see if there’s any interest.” 

And in hindsight, this is something I wish I did too.

You should focus the majority of your efforts on growing the business itself, rather than your exit strategy – so it’s ideal to have somebody to do this for you. The more successful a business you can build, the better the offers you’ll receive.

Remember to consistently engage with those who might be well-positioned to pitch your business to a third party. The more opportunities you have for people to get your business in front of potential buyers, the better. 

Hopefully, by the time you decide you’re ready to sell, there’ll be a great offer there on the table waiting for you.

Selling a successful business to attract buyers

The golden rule in selling a business is this: your business will never be more valuable to buyers than when you are bang in the middle of its success.

Perhaps this rule might not sit right with you at first, but being uncomfortable isn’t always a bad thing. In fact, sometimes, it’s a sign that you are doing well – something I mentioned in another post about business coaching.

So if you’re someone who’s thinking about selling your business in the future, start planning for it sooner than you might think. A successful business will always be more attractive to buyers.

If you’re feeling burned out, exhausted or just need a break from the business, reconsider your idea of selling. What made you so enthusiastic to begin with? What can you do to reignite that passion? It’s that energy and passion that will make your business all the more appealing to potential buyers.

And if you’re feeling energised and excited by your business right now, ask yourself: is selling an option to you right now?

I love chatting through this subject with entrepreneurs like you, so if you’ve any questions about this, let me know.

I’ll be more than happy to chat with you.

(By the way, if you’re looking for a handy guide to help you sell your business, this booklet from Grant Thornton is a great reference.)