Thinking of moving on from your business? Paul Quintero, CEO of Accion East, discusses the different motivations that might influence the decision to sell.
So, in terms of who to sell your business to, I go back to the motivation again. What’s the long term or for the near term. Some people sell or transition to continue a legacy. Um, they’re very different motivations. In terms of selling to a company the advantages of selling to a company are that A) they’re too big to create new ideas, and they very much value what you’ve created, but their value add is they’re going to take your concept and leverage it through their distribution system, sales teams, global network, to take you from x to 100 times x. And in that kind of scenario you stand to gain a lot more financially, selling to a big company, than you would let’s say a friend or family. Conversely, if you know your business is one that will eventually be something that a large corporation wants, you may want to continue to enhance the growth of that business but because you’re looking to retire or move on, transition it or sell it to family so that they can grow it to the next stage and then they can decide whether they sell. In that instance, you obviously aren’t trying to maximize your cash proceeds, you’re looking to, to maximize the, um, income perhaps that that business can generate and you may, you may get some kind of payment stream, you know, in lieu of a big, big cash payout, or retain an interest, again, in that business until they sell it out. But the motivation of who to sell to really depends on why and people have different motivations, different sense of timing, and therefore, the answer to the question depends on why you’re trying to sell in the first place.