Today we’re going to talk about a topic that you usually don’t see when you’re consuming content about leaving your business. Usually you hear about the technical things the have to happen to your business to make it sale ready.
If you watch our videos for any period of time you’ll see that we often talk about the technical side of a business sale. At the same time, the part that causes the most problems when it time for you to actually leave your business has nothing to do with technical planning or doing anything to make your business better. In fact, it has very little do with your business.
Having a sale ready company doesn’t only mean that you can afford to leave and have built a business that someone else wants to own. It also means you have something meaningful to move to.
If you don’t, you’re in danger of having a major case of sellers remorse. The worst part of sellers remorse is the loneliness you feel after you leave your business and the phone stops ringing.
Today, we’re gonna talk about a topic that you usually don’t see when you’re researching what it takes to leave your business. Usually you hear about the technical things that have to happen that make your business sale-ready. But today we’re gonna talk about something that’s not technical. If you watch our videos for any period of time, you’ll see that we often talk about the technical side of a business sale. You know, at the same time, the part that causes the most problems when it comes time for you to actually leave your business, has nothing to do with the technical planning about how much your business is worth or how operationally irrelevant you are, or any of those sorts of things which are really, really important to get your business ready for sale, but it’s not especially, what’s gonna keep you from selling or not selling.
Having a sale-ready company doesn’t only mean that you can afford to leave your business and have a build of business as somebody who wants to own, it also means you have something meaningful to move on to. I wanna repeat that, it means you have something meaningful to move on to. So often I see deals fall apart because that doesn’t happen.
If you don’t, you’re in danger of having a major case of seller’s remorse. The worst part of seller’s remorse is a loneliness you feel after you leave your business and the phone stops ringing. And I can tell you from personal experience that when I sold my first company, the phone absolutely stopped ringing.
So that’s what this week’s video is all about, so let’s jump in.
- You know, when I sold my first business in 1995, I thought that I would actually have maintained contact with people in my industry I came from, I came from the vending and food service business. I was really well known in that industry, I had taught hundreds of businesses about operations management and financial management, I would go to very new shows, people would stop me about every 35 seconds and have a short conversation with me. Well, I sold my business and then I went into working with a very large mutual life insurance company. Now two things had happened. I went to this meeting for the life insurance company, and what I found was that nobody was interested in talking to me ’cause nobody knew anything about me. Now that would change over the years, but for that three days, I was incredibly lonely because I came from a place where everybody knew me and I went to a place where nobody knew me. And on top of that, when I sold the business, even though I expected the phone to keep ringing, it didn’t, it stopped ringing. And by the way, it’s gonna stop ringing for you also. It’s not that the people are calling you they don’t like you, it’s because you’re just off the radar screen, and that’s what happens.
- So when you sell your business or if you sell your business and you move on, there’s a pretty good chance you’re gonna experience what’s called seller’s remorse. And the reason you get seller’s remorse often is that you’re gonna be lonely. You lose your business friends and you likely haven’t spent enough time making new friends and relationships outside your business. Without doing those two things, there’s a pretty good chance you’re gonna be unhappy at least for a while after you sell your business or after you transition out of your business.
- So what can you do? You might be wondering, “Okay, I wanna get my business be sale-ready, I wanna eventually transition out of my business, so what can I do?”
- Well, number one, you have to become operationally irrelevant. The reason you need to become operationally irrelevant, that will give you time to develop new interests, new things to do outside of your business. If you’re tactically the bottleneck in your business and everything flows through you, you don’t have the time or the ability to get out and start developing new interest that you’re gonna have after your business. When you become operationally irrelevant, you do have time for that.
- Number two, test some new ideas. Start five to 10 years before you wanna leave. Start testing things that you might find interesting. Now they can be business-related, they’re just not gonna be around your business. They might even be industry-related. I’ve seen people sell their business then go into work in the trade associations for the business. That might work for you, or it might be, I wanna do something completely different in my life, but start and test it before you leave your business, don’t wait until after.
- You know, you might wanna even take a sabbatical, in fact, I encourage all the people I work with, who are trying to get a sale-ready company together at the last stages, the last two years before they sell their business, first take a week off and don’t call in, then two weeks, then four weeks and eventually two months. And if you can make it for two months and never call in, you know, and you’re happy after that, you know you’re probably ready emotionally for you to leave your business.
- So, seller’s remorse is all about feeling fast, feeling cheap, which means small experiments. Do small experiments, build on those small experiments, find what works, let go what doesn’t work. But the important thing for you is you need to develop outside interest.
- So you wanna understand this is really important. And as you’re getting ready to transition out of your business, you’re gonna go through four stages.
- The first stage is anticipation, now by bet is you’ve been anticipating selling your business for a really long time.
- The next stage is you’re gonna end. That’s the day you actually sign the paperwork, pack up your box and walk out the door. Now it might be something that’s over a three-year period, it may be something over a five-year period or like me, it might be something which is a 45-minute period, literally 45 minutes after I signed the papers to sell my business, I picked up the box and stuff in my office, I walked out and that was the end.
- Then there’s passage, now passage is where seller’s remorse is, you’re trying to find a new way, you’re looking for new things that happen and don’t work. If you’re experimenting with this before you sell your business, you’re gonna find you’re going through some stages of passage and anticipation at the same time.
- And then finally we get to the new beginning. Now the reason it is so important for you to review these stages understand is my experience is, the stage you think you’re in is not the stage you’re actually in, which is one of the reasons having an outside person look at your situation and help you coach you through it is something that can be really, really useful.
You know, having a sale-ready company doesn’t mean you wanna sell it. It means you’re ready and your business is something that someone else would wanna own, that’s all. Now one of the biggest reason businesses aren’t sold is because the owner knows there’ll be lonely afterwards. I don’t want this to happen to you. I want you to be able to leave your business when you want, in the way you want.
So why don’t you let me know what you think by scrolling down and leaving a comment.
And while you’re at it, DOWNLOAD our Free eBook on “Relationships And Roles In Your Business”. You’ll find that as you move up the ladder of how you spend your time, you’ll have more time to develop outside interest from your business. And I can’t tell you how important this is for you to do. It’s also gonna help you keep from getting burned out in your business, by the way. And then someday we’ll do a video on that one topic all by itself.
So this is Josh Patrick, you’re at The Sustainable Business, thanks a lot for stopping by, I hope to see you back here really soon.