There are various ways in which an entrepreneur can exit the business and these include transfer to family members/children, liquidating the company, filing for bankruptcy or outright sales to external parties.
Selling your Business
Do you own a business enterprise and have ever thought of selling your business to move on to something more lucrative, trendy, new or profitable? If yes, you are not alone because no matter who you are, there comes a time, when as an Entrepreneur, you must bow out of your business; either by choice or by factors beyond your control.
The thought of exiting a business may not be an easy task and may be more difficult where the business has evolved as a “family business” where the family members have put in time, energy, resources etc. to make the business a success.
Knowing that exiting your business is only a matter of time, why not plan ahead? Not planning ahead means that in the event of an exit, especially an unscheduled exit, that there is a higher risk of challenges.
Do not let the business die in your hands!
What could be your reason or motivation?
Each Entrepreneur has a reason or motivation for cashing out on his/her business. Some of these reasons/motivations might include:
- Diversification of business interest and wealth
- Challenge to start something new or low motivation in current business
- Leaving when ovation is loudest
- Irresistible offers from potential investors
- Liquidity or financial challenges
- Retirement based on time or age
- Successor Challenges – Lack of interest by child/family member
- Unsuccessful/ unprofitable business thus quitting or starting a new venture
- Strong and increasing competition
- Change in government regulation or policy
- Others such as Health concerns, Divorce, Death of spouse /co-owner etc.
What are the available options?
As mentioned earlier, there are various ways in which an entrepreneur can exit the business. Selling your business is just one of the exit options, this means you get (all or part of) your reward while still active. Selling your business could be done through sales to:
- Employees (via stock option or buy out)
- Competitors or other third party (outright sales)
- Partners (via a buy/sell agreement), or
- The public (via a stock offering – Initial Public Offer or Private Placement).
The good news is that you can now sell your business venture at any stage of the business irrespective of the level of profitability it is currently earning.
Technically, selling your business could mean:
- Selling the business as a going concern i.e. new owners take over the business while the staff, customers, suppliers are retained. There is no disruption in the business as the only change is in the ownership.
- Selling a part of the business; here you sell some shares of the company in exchange for funds from new investors. The entrepreneur/business promoter can achieve this by selling his own shares (the money goes to the entrepreneur) or by creating more shares and selling to investors (the money goes to the business NOT the entrepreneur).
- Selling the assets of the business; here the assets of the company will be sold off (possibly in piecemeal) while the business remains.
At Business Catalysts, we are not only ready to plan ahead with you, we can also assist you to SELL your business or BUY an existing business.
Remember selling a business is not like selling a smart phone or a bottle of water. It requires planning. You will definitely get more value if you plan ahead.
Don’t kill the business; Talk to any of our team members today.
If you will like to receive additional information on how to sell your business, kindly visit www.businesscatalystslimited.com or send an email to firstname.lastname@example.org and one of our representatives will reach out to you.
Tel/WhatsApp: +234 817 908 6353