By: Steve Cody, Peppercomm
Even if you’re not expecting an exit anytime soon, it’s never too soon to start planning. Below are three dos and three don’ts of selling your business from Sylvie Gadant, partner and practice leader at Transaction Advisory Services at Citrin Cooperman, and Donald DiCarlo Jr., national director of business owner planning for Wilmington Trust Wealth Advisory Services.
1. Do surround yourself with a team of seasoned merger and acquisition advisers consisting of investment bankers, corporate attorneys, CPAs, and wealth managers. If this is your first time, the M&A advisers can educate you about the process.
2. Do plan properly to prevent poor performance. Start the process early.
3. Do be honest; it always pays dividends. Being up front with a potential buyer is the smart thing to do, since they’ll eventually find what you’re trying to hide during due diligence.
1. Don’t forget to think ahead. This is the No. 1 mistake sellers make. An exit strategy shouldn’t be viewed as an end, but rather, as a beginning.
2. Don’t fool yourself. Be realistic about the valuation of your company.
3. Don’t confuse management succession with ownership succession. A business owner must distinguish between the ownership of the business in which they just retain financial custody and the management of the business in which they are still in charge of operations.