The acquisition process can be riddled with low offers, unreasonable conditions (often not solely from the buyer), and questionable judgments from so-called experts during due diligence that may lack basic practicality. Financing entities may also add their own layers of contingencies. It’s easy for frustration to build, and a seller might feel tempted to take it all personally. This is a mistake. Logic must take the lead and the emotions of selling a business need to be kept in check.
Pause, breathe, and consider the larger perspective. While it may not be flawless, neither is life, and selling a business is no exception.
How does it feel to sell your business? Selling your company is not something that happens every day. It’s a major life decision. Therefore, it’s only natural to fear it since you’re navigating the emotional terrain of letting go of something you’ve built. Selling your business will be full of uncertainty, with the company being your most valuable asset, which gives you a sense of purpose.
What is the emotional side of selling a business? It’s natural to feel that you might be walking down the wrong path and be afraid of letting go of something you’ve built from the ground up. It’s your life’s work — a significant part of your identity. We discuss the emotional side of selling a business and how it affects the stages of selling in the sections below.
The initial, and perhaps most vital, step to facilitating a smooth handover starts well before the actual process begins – it’s about having a solid grasp on the reasons why you’ve decided to sell.
• Are financial pressures driving your choice?
• Is it health-related?
• Has the challenge simply become overwhelming?
• Or are you considering retirement?
• Are you aiming for financial security?
Equally important is being truthful with yourself regarding your objectives for the sale.
• Are you aiming for a swift departure, or do you have the patience to wait for the right offer?
• Are you flexible in negotiations, or do you have non-negotiable terms?
Defining your motives and setting expectations early on will allow for better decision-making and help prevent unwanted emotional reactions during the process.
Bringing in professional advisors can offer the critical knowledge and experience needed to navigate the intricate process of selling a business and the exit plan. For instance, selling to a family member or a long-time employee demands a completely different approach than selling to an outside buyer.
Furthermore, these experts can help ensure you extract maximum value from the sale, securing the best outcome for your investment. They can aid in evaluating your company’s worth, determining its appeal to the market, deciding on when it’s the best time to sell, and crafting a financial plan for your future post-sale.
As the time approaches to select a buyer, you might discover that emotional factors start to outweigh what are typically considered practical concerns. For instance, many clients initially prioritize meeting their financial objectives. However, as they become more familiar with potential buyers, it often becomes more crucial to them to find someone who will treat their employees well or someone they feel they can truly trust.
Negotiating the sale of your business can feel like bargaining over the worth of everything you’ve built. It’s a process that often comes with emotional strain.
The conflict between financial aspirations and your personal connection to the business can lead to heightened stress, possibly affecting your decision-making.
One way to manage this tension is by separating your role as the business owner from your personal identity.
Due diligence is usually the most exhaustive part of the M&A process, and it’s often at this stage that sellers start to feel deal fatigue, marked by frustration or exhaustion.
While deal fatigue can occur at any point during the sale, it’s particularly common in this phase due to the in-depth scrutiny of every aspect of the business, from legal and financial details to human resources concerns.
Once due diligence is finished, the prospective buyer can move forward with signing the final contract, legally referred to as the Sales and Purchase Agreement (SPA). This legally binding document lays out the specific terms of the transaction and finalizes the conditions that were negotiated between the buyer and seller. The SPA includes key details such as the assets being transferred, the purchase price, payment terms, and confidentiality clauses.
With the SPA signed, the deal is officially closed, and the seller can begin focusing on the next phase of their journey.
After closing, sellers often feel relieved that the M&A process is behind them. For those who sell to Volaris, there’s an added sense of reassurance, as Volaris never sells the companies they acquire, meaning the business won’t face this process again.
As you get ready to inform the team about the sale of your business, it’s natural to feel a sense of unease. Asking integration managers to assist newly acquired companies in navigating the transition effectively is recommended. These professionals offer guidance on how to communicate the change once the deal closes, helping to maintain employee engagement as they adjust to the new ownership. They are also well-equipped to address the common concerns employees tend to raise after a sale.
At the same time, it’s important for owners to keep building trust with their customers.
• Understand your buyer’s motivations to boost confidence during negotiations.
• Seek emotional support from a family member, friend, or professional.
• Plan for your future to reduce anxiety and feel in control.
• Focus on the reasons you’re selling to stay positive.
• Embrace change and new opportunities post-sale.
Website Closers is a team of well-trained intermediaries with expertise across diverse digital business models. Whether you’re interested in selling a digital marketing agency, Amazon FBA, SaaS, eCommerce, or any of the numerous other digital ventures we represent, we will assist you prior, during, and after the sale process, including dealing with the emotional side of selling, to help you achieve the optimal deal for your business.
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