Many entrepreneurs have high hopes for their business ventures when they begin. Some are passionate about their businesses, and others launch strategically with an exit strategy in mind.
And there are just as many reasons for starting a business as there are for deciding to sell. Sometimes, business owners sell because they believe they can’t outwin the competition, and adopt the “if you can’t beat em’, join em’” mentality. Others simply become tired of running daily operations and would rather focus their efforts elsewhere.
Either way, if you’re thinking about selling your business, here’s what you need to keep in mind:
Find the Right Business Broker
A business broker can prove instrumental in helping you sell your business, and can even get you a higher valuation. Just as buying a business requires a substantial amount of research and know-how, so does selling a business. “A business broker will come in and help you show your business in the best light, effectively maximizing your worth, value perception, and sales prices,” says Transact Capital. “There are several ways business brokers work to achieve this; notably through marketing and directed sales efforts geared towards qualified buyers.”
Business brokers also maintain the highest level of integrity and confidentiality. Without an intermediary, this can be very difficult. After all, you’re speaking to multiple prospects and ensuring each of those prospects doesn’t exploit the inner-workings of your business is tough—especially when you’re handling the sale alone. Business brokers can even market a business without revealing its identity. It all depends on what you’re looking for and what you expect out of the arrangement.
Keep Your Emotions at Bay
As you may very well know, emotions can easily get in the way of an important transaction like selling your business. Naturally, although you’re selling your business, you might be wary about the future of it after you pass it off. Just because you’re selling it doesn’t mean you don’t care about it’s long term future; in the end, you want the business that you started to be long and prosperous, even if it’s not happening by your hands.
Some business owners in the early selling phases are hesitant to sell to competitors, and distrust the business and offer they bring to the table. This approach isn’t the way to go: while you should always proceed with caution, this doesn’t mean you should outright reject some of the offers and letters of interest you receive.
Understanding the Competition
As previously mentioned, you shouldn’t shut out competition that’s interested in purchasing your business. But you should always proceed with caution when you’re approached by your competitors. In a perfect world, a competitor wouldn’t waste any time unless they were seriously interested in making a deal with you. But in a cutthroat business landscape where only half of all small businesses survive beyond the 5-year mark, it happens.
For instance, some business owners might disguise interest to learn more about the inner-workings of your company. You can help yourself weed out the unfavorables by having urging all involved parties sign a disclosure agreement and exchanging detailed information about the business at the same time. After all, you need buyer background information, too.
Use a Website Marketplace
Not all businesses require the need for a valuation. You may have a blog or website that’s generating revenue, and in this case, you can use a website marketplace to sell your brand. One of the most popular options is Flippa.
On Flippa, business owners can sell and auction established websites and their corresponding brands. Simply upload data about your business, such as the amount of revenue it’s bringing in, monthly page visits, bounce rates, current subscriber account, etc.
For instance, Jeff Taylor sold his website FightState.com on Flippa for $300,000. In an interview, Taylor said, “I’ve used Flippa since the early days of it. It’s always an exciting experience. There’s not many experiences in this business better than seeing that bid icon light up. It’s no secret that Flippa has high visibility and a large, active user base. I want to get as many eyeballs on a sale as possible. I’ve always focused on building quality sites with very strong communities that support them.
Selling your business is an important, life-changing decision. This isn’t just a financial decision; it’s also an emotional one, too. Make sure you take time in making your final decision, and understand that once decided, there’s no turning back (well, you could always buy back your sold business, though, even though it’s impractical.)