Could be the difference between euphoria and disappointment
The most common phrase we hear from business owners is, “we’ll sell when we’re ready to sell”. On the surface, this statement is clear and it makes great sense. But, when you are ready and if the market of quality acquirers is not, then achieving your euphoric exit outcome that you always dreamed of is most likely unachievable.
We know retired business owners that share with us they missed their optimal window for exiting their business. Upon reflection, they realize they didn’t give much thought over the years to this dynamic. They assumed that buyers would always be available whenever they decided to sell. They learned the hard way that yes, perhaps there are always acquirers, but not necessarily ones with the aggressive appetite for paying premium valuations at the time they wanted it. These ex-owners share that they wished they had maintained a better awareness of the M&A cycles and managed their business to be ready to exit when the acquirer appetite was at a premium.
Our role in working with private business owners is taking away their uncertainty on how to monitor the cycle within their industry. Monitoring the M&A activity within your industry (globally, nationally and locally) is a good starting place and the internet offers a variety of ways of doing this. A second way is periodically talking with investment bankers and brokers in your industry for their high value insights. These are just two of the many steps we guide owners through in building their awareness.
The bottom line is this. Of course you have the right to own and run your business for as long as you would like. But, if exiting to a third party is a likely outcome for delivering the reward you’ve always dreamed of, then realize it’s optimized most often when quality acquirers are actively buying and this occurs in cycles. Lead your business in a way that allows you to enjoy it but also be ready if the right party knocks on your door with a check book that they are ready to put to use with a level of valuation that you’ve dreamed of. Use time as your friend to continue building the worth of your company but parallel path, monitor your market to know when your exit window might be ideal.
