A Business Owner’s Trifecta: Secrets to Build, Scale, and Sell Your Business
The following is an excerpt of The Art of Selling Your Business: Winning Strategies & Secret Hacks for Exiting on Top, the final book in a trilogy written by John Warrillow about building a business to sell. The Art of Selling Your Business is available January 12, 2021, from An Inc. Original.
Praise for The Art of Selling Your Business
“During a negotiation to monetize all that work you’ve done to build your business, you can lose years of equity value in minutes if you are not prepared. The Art of Selling Your Business is a must-read (and apply) now to ensure full value for your business.’’
-Michael Houlihan, Co-Founder and NYT best-selling author, The Barefoot Spirit
Sold Barefoot Wines to EJ Gallo
THE SECRET TO A HAPPY EXIT
What’s driving your decision to consider selling your business now?
Are you ready to retire? Maybe a little tired? Bored? Burnt out? Sick of dealing with employees and red tape?
These are all legitimate reasons to want to sell, but if they are the only reasons you’re leaving, you could end up regretting your decision. You’ve worked hard to build your business. It probably gives you a sense of purpose and accomplishment. Selling means you risk losing all of that. My friend and colleague Bo Burlingham wrote a wonderful book about the emotional toll of selling a business, called Finish Big. I’d recommend reading that book if you want to explore this topic further. This book, however, is about the art of selling well, and we will cover lots of negotiation strategies and tactics for maximizing your take from the sale of your business. But indulge me for a minute as we address something underneath all that. One of the most important things you can do to ensure you sell your business well has nothing to do with how much money you get for your company, but it has everything to do with your reasons for wanting to sell in the first place.
Push vs. Pull
Most people would have you believe starting and growing a business is personal but selling is simply a business transaction. Yet selling your business is just as personal. The secret to looking back on your exit with fond memories rather than with regret is to get clear on your “pull factors.”
Pull factors are the things that you’re excited to go do next. What are you enthusiastic about diving into after you sell your business? That’s the most important question underlying this entire process — yet most founders never ask it.
By contrast, “push factors” are the things that are pushing you out of your business. Push factors can be anything that frustrates you about your company or takes a mental toll over time.
For example, Tommy Berretz co-founded Texas Aquatic Enterprises (TAE) in 2005 to maintain commercial swimming pools for homeowners associations, water parks, apartment buildings, and schools. Once contracted, TAE managed all aspects of a community swimming pool, including construction, balancing chemicals, repairs, and hiring lifeguards.
The business grew to more than 200 employees, but by 2012, something was gnawing at Berretz. He had heard a statistic from an industry guru who said swimming pool management companies experience a drowning every seven years. Berretz had been in business for 12 years without a major incident. The thought of a child dying in a swimming pool under his management weighed heavily on Berretz and was a contributing push factor in his decision to sell TAE in 2017.6
As with Berretz, push factors can be fine motivators, but the secret to avoiding a feeling of loss when you sell is to get clear about your pull factors too—like Shaun Oshman envisioning life on his sailboat.
Taking Action
Create your own vision board that illustrates where you want to be after you sell. Cut pictures from magazines that symbolize the things you’re excited to go do, and pin them to a board. Hang your vision board prominently in your home so both you and your family can be reminded of why you’re going through the process of selling your company.
