Top 4 Reasons for Selling Your Company or Searching for Investors
In today’s article, we will cover some of the most prominent reasons why you would want to consider selling your company. The sale of a company is one of the most paramount decisions in life, so even if there are all reasons to sell, many entrepreneurs often try to find excuses not to make this vital decision in the end – a decision that may be the best for the owner and the future of their business. Remember, not deciding is a decision in itself, and hence has its own consequences.
Not selling a company when there are enough imperative reasons to do so can lead to financial losses, depreciation of your company’s value or even cause company closure altogether. Essentially, it could be a lost opportunity of receiving the best value for your company. Let’s take a look at some of the most common circumstances that can make the sale or search for potential investors convenient.
Personal reasons – preparing for retirement. A critical and extremely personal milestone in anyone’s life. There are numerous examples of businessmen who, at the age of 55, decide they have struck the ‘number’ and made enough bank to ‘have done it all’. Others prefer to keep on ‘fighting’ until the age of 70+. It is critically important to have a solid plan and professional advisors prepared well before you decide to retire and sell your company!
Wanting to do something different in life – you may feel the weight of social responsibility on your shoulders, moving you to dedicate the rest of your years towards an NGO, or maybe you want to explore and focus on another field of activities, perhaps devoting yourself to politics or family. You must understand that having founded or inherited a company doesn’t mean you have to spend your whole life dedicated to it – life’s too short!
Change of business or simultaneous dedication to more profitable companies that require more attention – sometimes you find that another business of yours is more profitable, less tedious and has a brighter future, or simply aligns with your current interests more than the other.
Economic reasons – need for a new injection of resources. A very common example is when a company is losing its competitive position in the market and requires more capital to keep up with the competition. It is possible that an owner decides not to reinvest the capital that he has made from the company back and prefers to sell.
There are a handful more reasons why you would want to step off from managing a company to pursue a different field of interest, however above are a few most common ones. Don’t forget to be prepared when you decide to sell your company! It is always better to be secure and sound with a team of professionals who will guide you through the entire process and make sure your company is receiving the maximum value from the deal – follow this link if you want to learn more about mergers and acquisitions or this one if you want to sell your company and wish to receive a professional advice from credible team of advisors with over 10 years of experience in the field of corporate finance.