Many business owners find that selling their business can lead to one of the saddest, most disappointing and loneliest times of their lives. Surprisingly, it often has nothing to do with how well they were paid for their business.
After years of hard work, challenges, failures, strong friendships built on achieving business goals with their teams and getting out of bed every morning with a strong sense of purpose - suddenly it’s all over.
I’ve seen plenty of successful, well balanced business owners experience feelings after their exit ranging from signiﬁcant loss to anxiety, utter boredom, loss of conﬁdence and – in some cases – depression.
If you have feelings like this after you exit your business it’s not unusual. According to the highly regarded Exit Planning Institute in the US, 75% of business owners profoundly regret selling their business.
In our last post we looked at the issues that contribute to the emotional roller coaster experienced by many business owners as they exit their business.
In this post, we look at the three most common sources of stress and emotional turmoil after you exit your business, and how to deal with them.
Dealing with failure
Many business owners find they need to confront feelings of failure around exiting their business.
You might end up selling your business for a lot less than you wanted (or thought it was worth), not get your exit deal done at all (so end up back running your business) or need to just close your business because you can't find a buyer.
Most people have no idea how hard it is to build a business and make it successful, so any judgement they make about your success or failure as a business owner is always going to be superficial at best.
Conversely, those closest to you – such as family, other business owners and close friends – are the ones who really will understand. They will also be there to support you moving on, as you inevitably will.
A business exit is the only time when the value of your business turns into something tangible: your sale price. I often see business owners work themselves into a lather over value issues during and after their business exit – what is often called “seller’s remorse.”
If their buyer significantly increases the value and/or profits of their business, they become concerned they weren’t paid enough. They also often worry about how this reflects on how well they ran their business when they owned it.
The right buyer will be in a position to grow your business more quickly than you because they can throw more resources and funding at it, lower costs by using their existing infrastructure, and access a much wider customer base. So, you should expect the value and proﬁts of your business to increase in the hands of your buyer.
As long as you were well and fairly paid for your business (taking into account its future potential), you should be comfortable with your buyer realizing more value out of it. It means you built a strong business that’s capable of growing without you – be proud of that. Also, at the risk of being blunt, if your business goes on to thrive without you and you’re struggling with that you just need to get over it.
Conversely, I sometimes hear former business owners smugly telling people that the new owners are doing a shocking job of running their old business and that it would have been far more successful if they’d kept running it themselves. Whether this is true or not, when a business fails to thrive in the hands of a new owner, it’s not the sign of a good deal.
A good business exit should always have two winners: the seller and the buyer.
What will happen to my business legacy?
A question – related to seller’s remorse – which can really haunt and stress a lot of business owners is “what will happen to my business legacy now?”
Often, you don’t fully appreciate until after you exit how emotionally tied you are to your business purpose and what you have achieved in building your business. Effectively being severed from your purpose when you exit your business can be highly stressful, and catch you by surprise.
The reality is once you’ve sold your business you have little control over your business legacy. What you do have is control over what you do next. You may now be in a much stronger position to pursue your business’s original purpose in different ways or in different forums; alternatively, it may be time for a new purpose.
Many business owners experience the issues covered in this post after they exit their business. They generally can’t be avoided. Anticipating them, being ready to deal with them and having advisers, family or close colleagues to support and help you work through them is the key.
There are always a handful of business owners who achieve extraordinary levels of success when they exit their business. In our next post, we explore the unique challenges and issues faced by those business owners who achieve highly successful business exits.