Decide when and why to sell

Selling a business is a major life decision that requires clear motivation and reflection on timing.

While money may seem like the obvious reason (it often is), take some time to reflect on what's genuinely driving your considerations around transitioning your company.

As you weigh options, consider two things:

1. Selling shouldn't be an urgent decision. Despite beliefs that opportunities fade fast, most companies have inherent, stable value from customer relationships, talent, processes, and market share. Be patient. Quality buyers will appear.
2. Selling is not quitting. Nor does it require severing company ties. Many owners sell majority stakes while remaining integral to operations and strategy. Others retain minority shares to participate in future growth. With the right buyer fit, you leave on your terms.

The decision to sell is ultimately driven by personal and market factors unique to every owner's situation. However, there are several common motivations to sell.

Why would you want to sell?

If you’re reading this, you might be at least a little interested in selling your business. Below are the seven main reasons why owners, like you, decide to sell—some might resonate more than others.

1. Financial Security: While other motivations drive timing, sales proceeds provide retirement savings and lifelong financial comfort after decades spent plowing profits back into the business.
2. Exhaustion: Building and running a growing small business is grueling and all-consuming. It requires massive effort across every area, from winning new customers to paying bills and handling employee issues. After years or decades of this relentless grind, selling provides freedom to focus energy elsewhere rather than burn out.

1. Health Considerations: Likewise, the daily stresses and constant problem-solving of business ownership can negatively impact personal health, especially as you get older. Selling allows you to add years to your life after years of hard-fought success.

1. Family & Life Obligations: Changing life circumstances like marriages, new children, divorces, aging parents, or other family responsibilities often help crystallize the decision to transition away from full-time leadership.

1. Risk Mitigation: Every business faces ups and downs over time across factors like customer demand, supplier costs, competition, technology change, regulatory shifts, and economic cycles. Selling allows you to de-risk your financial position after weathering years of storms.

1. Legacy Planning: As a business becomes successful, most owners care deeply about legacy - ensuring the company and employees are looked after once they step away while reputation and brand remain intact.

1. Personality/Skills Mismatch: The entrepreneurial traits that made you successful in launching and growing a scrappy business often differ tremendously from the skills required to take it to the next level as a larger company. The same bullish tendencies holding your team back may signal it's time for new leadership.

Common misconceptions you may have

Many sellers hold incorrect beliefs about the process that lead to avoidable mistakes:

• I can sell my business in just a few months. (Truth: It will virtually never take less than 6 months for a business doing $1m+ of revenue.)
• I can sell my business without letting the buyer meet key members of my team, get data on our margins and customers. (Truth: Due diligence is comprehensive.)
• I can do a great deal without talking to many buyers, or by just picking a broker at random. (Truth: This is often a cause of seller’s remorse.)
• I can hire my personal family lawyer or accountant without M&A experience. (Truth: You want to hire lawyers and accountants that have experience helping people sell small businesses.)
• I can sell my business for the same price or multiple that friends or people online mentioned. (Truth: Price is a case-by-case basis. Avoid taking hearsay as gospel.)

Dispelling these assumptions upfront helps set realistic expectations for the process. We'll expand on many of these myths and mistakes throughout the guide.

Insight: Don't Try to "Time" the Market

While it's tempting to hold out for perfect exit market conditions, this rarely works in practice and can backfire through loss of momentum.

Focus first on personal motivations, goals for the transition, and finding a buyer who shares your values around stewarding the company going forward rather than macroeconomic cycles. Even if the market conditions are good, you shouldn’t push a sale across the line before you’re ready—this will often result in a deal you are not happy with.

Be clear about your goals upfront

Before starting the process of finding buyers and negotiating deals, outline your specific desired outcomes across areas like:

• Ideal Transition Timeline: From immediate complete exit to 2+ years of ongoing leadership
• Post-Sale Role: From no involvement to continuing full-time in leadership
• Type of Buyer: From owner-operator to search fund to private equity
• Deal Priorities Beyond Valuation: Protecting legacy, culture fit, employee welfare

Regardless of your motivations, it's important to think about what outcomes are important to you and why. Here's a cheat sheet, from the legendary book The Messy Marketplace (which is worth a read!) to help you narrow down your target outcome(s):