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MAKING THE DECISION: WHY SELL?
Deciding whether to sell your company is a very tough, ongoing challenge. Most owners and CEOs have invested so much of themselves that it is virtually impossible to see things objectively. Yet, you must. Because even if you do not want to sell the business, it may be the only smart move. In the world we live in now, where there's a lot of capital and a lot of private equity buyout funds, the big players can see a trend and jump on it faster. So you can't count on retiring with the same business you started and ran.
And it can work in the opposite direction, too, when a business owner is spurred to sell by lush visions of yachts and a life of ease. But reality is often less cushy. Most acquisitions these days are structured as cash/stock deals, and many times an owner actually has to partially bankroll the buyer with a loan against the sale price. So a few weeks on a tropical isle --no problem. But don't expect to buy the island.
Another point is that the trend is for buyers to find ways to handcuff founders so they don't fly the coop; this is a result of too many bad experiences where a buyer found that the founder had been key to a business's success or even survival. The continuity of a former owner's ongoing involvement can help ensure the company endures.
