Most business owners are not prepared to exit their own business. More than likely, that includes you.
It’s not your fault. No one taught you. No one showed you how to prepare for your exit. In fact, no one is really talking about any other parameter of your business except income.
Here’s the question:
Are you in business to produce income to pay yourself, or enough to cover payroll? Or are you in business to make a profit?
If you intend your business to make a profit, that means you expect to monetize the business at some point to produce the wealth you need for your reinvention.
When you decide you are ready and committed to an exit strategy, only then can your exit transaction team go to work on your behalf.
You’re familiar with the phrase “It takes a village to raise a child”. The analogy fits your exit planning well. It takes a team to exit your business successfully, your exit team.
Meet The Team Members You Need to Achieve Your Exit to Reinvention
Attorneys
IP Attorney – You want an intellectual property attorney to help you identify, document and protect the unique ideas, processes, products and services you provide.
Business Attorney – Your business attorney is your expert on business and commercial transactions.
Governance Attorney – Your corporate governance is a system of structuring, operating and controlling the company with a view to achieve long-term strategic goals that satisfy all stakeholders, and comply with all legal and regulatory requirements. To be buyer ready, you need a legal team to review, update or correct and document your corporate governance practices, processes, customs, policies, laws and institutions including the relationships among stakeholders such as shareholders, board of directors, employees, customers, creditors, suppliers and the community.
Personal Attorney – YOU hire this attorney to watch out for your best interests through the exit process. The business hired the business attorney to protect the business’ interests, not yours. He/she cannot adequately serve in both roles.
Estate Attorney – You need your estate attorney to be an integral player in the discussions of your exit options to protect your long-term best interests.
Financial Experts
Business CPA – You need your business accountants putting the books in order for valuation and in a form that is buyer attractive, showing off the business in the best light.
Chief Financial Officer – Even if you’ve never had anyone in this role, you need a chief financial officer looking at the strategic financial impact of every marketing, financing, or growth decision leading up to your optimal exit option.
Tax Advisor – You need your personal tax advisor to be an integral player in the discussions of your exit options to voice the tax impact on you of each choice.
Wealth Advisor – Your wealth advisor can help you fulfill your ultimate goals, live the lifestyle of your dreams, and leave a legacy and a dynasty. They can offer the best advice and opportunities if you include them in the discussions early – before you’ve made your exit choices.
Transaction Experts
Depending on the size of your business, the type of business, and the type of sale you are pursuing, you will want to use different transaction experts. They bring experience, connections, process and negotiating skills to the exit transaction that are irreplaceable for a successful exit.
Business Broker – A business broker assists buyers and sellers of privately held small businesses in the buying and selling process.
M&A Advisors – Mergers and acquisitions is a specialized field of corporate strategy, finance and management dealing with the buying, selling, dividing and combining of different companies to help an entity grow rapidly in some way.
Investment Bankers – If your business is large enough and the exit transaction is large enough or complex, you may need to work with an investment banker. who assist in raising capital or acting as your agent to issue securities.
Others
Business Partners – Your partners, whether they are currently active or silent in the business, must be part of the exit planning discussions or they can destroy your whole exit.
Life Partners/Spouse/Family – Your business exit and your reinvention plans affect them too.
Exit Strategist – You need someone focused on the strategic side of planning, systematizing, growing the business in preparation for your exit and reinvention.
Marketing consultants – You may want to bring in other experts to maximize the value of the business to the buyer
Staffing consultant – You may want to hire in key players/successors to make the business more attractive to the buyer
HR consultant – An HR consultant can help you formalize your corporate culture and tie your team to the company, beyond your exit to secure their future with the company under the new owner.
When you surround yourself with experts to support the process (your exit team), your business will be stronger, demonstrate appealing growth projections, will have a higher valuation than otherwise possible, and become buyer attractive. As a result, you can and will be able to exit your business by intention on your terms instead of closing the doors with no monetary gain by default.
Kerri Salls
Exit Strategist
P.S. Like to learn more? Join us for a compelling webinar, Race to Exit, on Tuesday, February 28, 5PM Eastern. Details here.
