Top tips for a successful business exit
Do you want the best roadmap to a successful business exit? Here are key issues to bear in mind.
Plan ahead
Get into the ‘exit mindset’ as soon as possible, possibly as early as the start of your venture. Build your exit strategy into your business plan, with a clear yet realistic objective of what you want to achieve.
Know the value
Be clear about where its business value lies. Is it your products and customers, or intellectual property such as your brands and patents? The price of your business relies on this ‘value story’.
It’s not just about the figures
It can be very easy to get caught up in your ‘baby’, but remember that you need to maintain impartiality. Your business is a commodity that will be developed and sold. Financials are important, but bear in mind that buyers are also interested in great ideas executed by the right team.
Keep a balanced perspective
It can also be easy to focus too much on operational details and miss crucial broad-picture aspects such as how robust your business is. However, it goes without saying that you shouldn’t neglect the day-to-day operations. Find a balance between the two perspectives.
Get great advice
Find the best advisors for your business plan. The strength of this advice can help to raise the sale price.
Be tax wise
Tax should be viewed as a business cost that can be reduced, so take advice on how to structure deals in the most tax-efficient way possible to minimise your liability. And remember when you come to sell, whilst the price is important, it’s the amount in your pocket after that’s crucial.
Keep records
Bear in mind that maintaining a strong paper trail will simplify the due diligence and the disclosure processes, and could have a positive impact on the price.
Communicate
A key component of the value story should be the team running the business, so make sure you keep everyone in the loop. If your key talent gets disheartened and leaves, this could be disastrous.
Be patient
Most deals experience a few upsets along the way, but this doesn’t necessarily mean they will fail. Positivity and cooperation should see you through.
What next?
Spare a thought for what you want to do after your exit. There may be scope to build something into the final deal that can help you.
