The Business Owner’s Guide to a Successful Exit

The sale of a business is typically the most important transaction an owner will ever complete, making it paramount to transact with the right acquirer, at the right time, for the best price. The article below outlines key steps and tips for a successful transaction.

Identify the Right Buyer

When a business owner begins to explore the exit process, identifying the key differences between strategic and financial buyers is a great first step. Understanding the different firms’ decision-making processes will help clarify what each type of buyer seeks and can help the owner decide which is the best fit for their specific situation.

Identify Your Goals

Success may depend on current industry multiples or other market factors outside of the owner’s control. But in some cases, ownership and the business’s executives can play an instrumental role in increasing the probability of success, by: 

a) valuing their company at or near a realistic number 

b) employing a diligent and thorough process in marketing the company

Several exogenous factors that may impact your planning

Focus on the Three P’s

1. Purpose: Is there a clear purpose and vision that is understood by all key stakeholders? Everyone involved needs to understand and obsess over the strategy in order to fulfill the ongoing goals.
2. People: Are the right people in place to fulfill the purpose? If not, find the right ones to replace them. There also needs to be a team of people who can help with day-to-day business needs.
3. Processes: Are there processes in place to execute properly? Having a management framework in place with the proper review cadence will help ease the transition and keep the team focused on the purpose.

Eight Tips for the Transaction

Make sure you have a team supporting you during the deal process. Here are a few things to keep in mind: