The #1 Reason Most Businesses Aren’t Sellable

Today’s issue is sponsored by Oceans

Hire offshore talent that come with impressive resumes:

Amira, a Fordham University grad and former JP Morgan associate. Anika, a Kenyon College grad and former Moody’s analyst.

This is the level of talent that Oceans attracts to partner with companies like True Classic, Pattern Brands, and Othership.

Hire full-time, proactive, highly experienced individuals for $3000/month.

Learn more about Oceans

Hello Founders and Funders,

Here’s an important question that far too many founders haven’t considered yet…

What’s your exit plan?

It may sound crazy, but the vast majority of business owners haven’t thought this through.

And even fewer have specifically thought about what it takes to turn a business into a sellable asset.

It’s about far more than just generating revenue.

I often talk to business owners who have never thought about how their personal transition into retirement will impact the business they own.

I’m even more surprised by the number of business owners who think selling their company will be easy, almost effortless and should only take 30 days!

The sad reality is most business owners may find themselves unable to sell their businesses when they’re ready because they never planned for it in the first place!

This unfortunate fact is made even more troublesome when you realize most business owners have anywhere from 75% - 90% of their net worth tied up in their business.

Therefore, imagine an owner who has planned his or her retirement predicated upon selling their business to adequately fund retirement needs…

But then the business doesn't sell.

According to the Exit Planning Institute, it is estimated over the next decade or so, about 4.5 million firms, representing more than $10 trillion in business value, will undergo transition.

Most of the experts in and around mergers, acquisitions, and estate planning estimate only about 20% - 30% of business owners seeking to sell their company will be successful!

Here are some challenges from a survey of business owners that point to the reasons for this lack of success:

The Final Word

Selling a business is NOT a simple process and it’s definitely not a guaranteed exit plan.

And maybe once you look at your exit plan, selling isn’t even your #1 option!

So if you’re a founder, take the time today to ask yourself… “what is my exit plan?”

Then, start to figure out what steps you should start taking today to put you on the right path to your ideal exit.

Don’t wait until 1 month or even 1 year before - take action today.

Want some more insights about selling to exit? Check out this complimentary summary of our interview with Mike Finger, CEO of ExitOasis.com, from our recent summit.

David