The dos and don’ts of exiting a business

I sold my business in October.

It sounds weird saying it and it looks even weirder in print. I always knew the day would come when I would sell but I didn’t know when and I didn’t know how.

I never subscribed to the “plan your exit from the start” philosophy. Certainly not as a first-time business owner. I’ve met a lot of “entrepreneurs” who’ve had great exit strategies from the outset but went out of business before they could execute them. They didn’t put enough time into making sure the business actually survived long enough for them to see a return.

One thing I’ve learnt from this sale is that the due diligence required is unreal. Other people who have sold their companies told me about it. They tried to stress how time-consuming it could be but it’s one of those things you can’t really comprehend until you go through it yourself.

I have to give special thanks to my long time friend and business partner, Kelly Robinson, who took care of virtually all of it, leaving me to run the business – nice one Kel.

A lot of negotiation takes place around the findings and it’s vital to be in a strong negotiating position. That means having every piece of paperwork filed, legitimate answers to every question, solid accounting practices, water-tight contracts and no skeletons in the closet (I should also thank Kel for ticking those boxes early doors!).

You don’t need to plan your exit from the beginning – there’s plenty of time to consider that – but you do need to prepare for the eventuality that one day there will be one. That means doing everything above board – even the best exit strategy will flounder over unsatisfactory or unsettling findings in the due diligence process.

One piece of advice to remember if you ever plan to sell a business (and those of you that already have will hopefully allow themselves a wry grin when they read the rest of this sentence) is that there are a lot of good advisors out there: legal, tax etc who will do a flat fee for the deal. If you can find a firm you are comfortable with and you can strike that type of deal, DO IT! We didn’t…

As I look back on six years of hard work in the run up to this deal, I can’t believe how much fun I’ve had, how many great people I’ve met and how much I’ve learned (and earned). And the best thing about it all is that I simply cannot wait to do it all over again.

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