12 May Around the Web: A Week in Summary
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A recent article from Forbes entitled “Selling Your Business? Quiz Yourself First With These Must-Ask Questions” explores key considerations for business owners who are contemplating selling. These considerations can help put you in a position for a successful sale.
Ask yourself these 5 questions:
- Is the business ready for a sale?
- How much can I sell for?
- What happens after the sale?
- Am I ready to sell the business?
- Who can help with selling my business?
A recent article from Viking Mergers & Acquisitions entitled “Benefits of Selling to a Private Equity Group” discusses how the sale of a midsize business to a private equity group can be a win. Private equity can range from a minority buy-in to a majority buyout to a complete transfer of ownership.
Some of the benefits of selling to a private equity group include:
- Private equity groups can bring great industry experience to the business to guide and grow it
- Private equity groups can bring operational expertise to improve, optimize, and scale the business
- Private equity groups are looking to grow the business and get a return on their investment, meaning a future sale could bring you greater rewards if you remain a partial owner after the initial sale
A recent article from Cape Cod Times entitled “Business tips from SCORE: What you need to know before selling your business to a relative” offers advice for business owners who plan to transition the business to a family member. This can be a challenging move, so proper planning is key.
Well in advance of the transition, have the family member gain experience by working with someone other than you. Let them earn their role in the company, rather than handing it to them, so that they learn the ropes and gain necessary skills.
Have a third-party valuation performed to get a true understanding of the value of the business. This can help avoid a disagreement on the sale price. It is also important to consider stock ownership among other family members.