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Let’s jump in…
Building a business is like mountain biking.
Maybe.
You see, I actually don’t mountain bike but it looks like it would be a lot of fun. Seems to be a bit challenging as well though.
On top of that, a significant risk of injury.
Fun, but a lot of work, and also risky…yep, sounds like owning a business.
SELLING your business can magnify all of those!
It’s a deeply personal journey. For many, the business is at least part of their personal identity.
Now, you may be thinking why would I want to sell my business? Or maybe, why would I want to sell my business NOW?
I get it, you spent years building it.
But what’s the saying:
“You either die a hero or live long enough to see yourself become a villain.”
This cinematic wisdom applies surprisingly well to business. Like heroes, entrepreneurs must know when to exit. In that vein, I identify three primary factors that shape a business owner's decision to exit:
1. Lack Of Desire
Like sand in an hourglass, a business owner's internal drive slowly runs out over time.
What begins as ambition and energy to grow eventually fades after years of dealing with challenges, leaving little desire to push for the next milestone.
And eventually, the sand runs out.
The desire or energy to pursue the next growth milestone is no longer there. Adding to that, or partly the reason for is reduced risk tolerance.
And they decide it’s time to start the next chapter in their book.
2. The Founder's Dilemma
The Harvard Business Review found that most founders give up control long before companies go public.
Why? Because they realized they had taken the business as far as they could take it.
The hardest but healthiest decision is knowing when the business needs fresh ideas and new leadership.
Not everyone can be a Phil Knight or a Bill Gates.
Sometimes getting to that next level requires a different type of leader.
Sometimes you are the one holding back further growth.
It isn’t a pleasant thought that someone else might be better at running your business.
My unsolicited advice though?
Don’t overstay your welcome.
3. Asset Diversification
At some point, preserving what you have is more important than adding to it.
This isn’t about not having the desire to grow, or the ability to.
Instead, it’s thinking about what level of risk is appropriate given your age.
It is a gamble to try to push your business to the next level when you can’t know with certainty how much longer you will want to keep doing this.
I mean, we aren’t exactly spring chickens.
For many, there comes a time when it’s a good idea to take some chips off the table and let someone else deal with the headaches and stress of trying to grow a business.
By letting someone carry the torch for you, you can mitigate risk while still keeping yourself in the game.
Win-win?
While this balance seems ideal, the reality is more complex. Selling your business is deeply personal and filled with uncertainty:
1. How much is the business worth?
2. When will the deal close?
3. Will it close?
4. What will life be like after the deal closes?
5. How will the new owners treat the business?
6. Will my legacy live on or be tarnished?
Many of these concerns may stem from the misconceptions about PE or the horror stories you have heard.
But there is a way to reduce or maybe even eliminate that risk: get to know potential buyers over time! No other PE group will tell you this.
Instead, they will likely just try to convince you, perhaps subtly, that you should sell to them.
By getting to know buyers over time, and I mean several months or even years, you can assess their approach and make informed decisions.
But look, while I’m not exactly the life of the party (cue my dry humor), I’ve been told I’m a decent human being.
Here's the thing: when it comes to selling your business, being a ‘good guy’ doesn’t automatically make me or Four Pillars the right buyer. Especially if you don’t care what happens to the business after you sell.
Selling a business isn’t about cutting ties, it is about transitioning to a new partnership.
This idea might make you run for the hills, or it could be exactly what you’re looking for.
The only way to know?
Take the time to get to know me, my partner and our approach. And don’t stop there, explore other potential buyers too.
After all, selling your business is a monumental decision.
You deserve to feel confident you’re making the right choice, whether that’s with us or someone else.
I won’t tell you when the right time to sell is. I won’t say that Four Pillars is the right buyer.
But by being proactive, you’ll maintain more control and have more options.
📖 Lessons
1. Know when to fold’ em: be proactive to maintain more control
2. Self-awareness fuels success: recognize your limits to unlock growth
3. Date before you marry: build relationships with potential buyers early
📅 Next Week:
Tune into next week’s newsletter, The Nell Hill's Story - Four Pillar’s first successful exit. Learn how we navigated our first acquisition in the retail sector in this spotlight on a local business.
Keep Building,
Nick
P.S.
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LinkedIn: Nick Mclean
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