Selling Your Business When You’re Ready

I’ve seen many entrepreneurs who were convinced they could time the mergers and acquisitions (M&A) market and exit their businesses at the highest point. But this is much harder to achieve in practice, as I’ve heard Class VI CEO Chris Younger talk about quite a bit. He even wrote a recent Inc Magazine article about this topic: by the time you reach the closing day of your deal, the ideal market moment may have passed, which I’ve had to explain to more than one business owner.  

So, if you aren’t always able to sell in the hottest market, when is the right time to undergo a process? In short, it’s when business and personal timing align. As Chris puts it, “You should sell when you and your business are ready to sell.”  

There are many considerations to business timing, such as the importance of selling when your business is growing and having a dynamic leadership team in place. But I want to talk about personal timing here, as it’s an underexplored part of preparing a business for sale and something that can have a surprising impact on your timing. 

Personal readiness: knowing it when you feel it 

Most M&A advisors concentrate on whipping a business into sellable shape, both in their interactions with you and in the resources they produce for prospective clients. This makes sense to a large extent. After all, you’re in a business relationship with your advisors, and most of your work together will go toward getting a deal done. Some advisors view personal readiness as too emotion-based and outside their remit, which leaves them to focus only on the hard numbers. That’s why not all investment bankers will ask you outright, “Are you sure you feel ready to let go of this business?” 

But they should!  

Entrepreneurship is an all-encompassing lifestyle: you took an idea and built an entire operational business from it, providing livelihoods to many people in the process. When that business is no longer in your life in the same way, you might feel like you’ve lost a crucial part of your identity.  

You want to be prepared for these feelings, so it’s worth asking yourself some big questions if you’re considering a sale, such as: 

• Do I feel excited about moving on? 
• Is the energy I dedicate to running the business waning or staying consistent? 
• How would I want to fill my time if the company no longer took up such a large chunk of it? 
• What do the people closest to me think about the prospect of selling the business?  
• What do I want my professional and personal legacy to be? 

If you get the sense that you’re not ready, you might want to concentrate on growing your business for the time being. You can periodically ask yourself these questions and others you can find in the personal timing and readiness section of Class VI’s report Is It Time? A Business Owner’s Guide to M&A Readiness. 

I’ve witnessed cases where entrepreneurs waited too long to ask themselves probing questions about personal readiness, and they subtly sabotaged their own deals at a late stage because something within was telling them the time wasn’t right. It’s an unfortunate consequence of not being prepared to let go. I don’t want this to happen to you! 

Is it your time? 

Both Chris Younger and I have seen how important it is to feel personally ready when selling a business. Your investment bank can tell you how well your business should hold up under due diligence scrutiny, but only you can confirm that the personal timing matches the company’s preparedness. If you think you’ll want to sell sometime in the future, start asking the right questions today.