When it comes to the topic of selling a business, most people often think of a succession due to age or a large transaction for corporations. Likewise, the sale of a business can help the selling entrepreneur as a new start into another phase of life. The reasons for this are manifold.
We are getting more and more mandates from entrepreneurs who are in their mid or late 40s. Far from an age where the “classic” succession situation is involved. During the free initial discussions, it often turns out that the companies are in no way in a bad economic position. Nor is there any sign of an economic crisis. Quite the contrary. The companies of these entrepreneurs are usually very solid and profitable. In fact, the young entrepreneurs are mostly technically up to date and bubbling over with innovative ideas. This is precisely the key point for the desire to sell a company.
Young entrepreneurs are doers
Younger entrepreneurs may have started their first company when they were 20 years old and are now 45 years old. Consequently, you can already look back on 25 years of entrepreneurship. During these 25 years, you have steadily built up your company. In the process, you have experienced the natural ups and downs of the business world. These entrepreneurs are now faced with a decision. Either continue to grow your own business or finally realise the many new ideas. The business has fed you well and in most cases ensures that you can lead a carefree life of financial independence. In their mid-40s, entrepreneurs feel the urge to try something new. Perhaps these people have a passion that has nothing in common with their own business. They are doers and not administrators of structures. Selling the company as a new start is the right solution.
A real-life example
The entrepreneur has been successfully running a rapidly growing IT company for years. He has enough employees, satisfied customers and of course customers who are never satisfied. He has put his heart and soul into this company. Yet he now has to deal with things he doesn’t enjoy. Staff interviews, customer escalation meetings, contract negotiations and and and. This entrepreneur is still on fire for his topic of “digitalisation”, but he cannot completely rebuild the company that is doing well or start from scratch. His company size is not suitable for hiring a managing director to replace him so that he can devote himself to completely new things. His decision is made. He sells the business and hands it over to a new entrepreneur at 100%. This allows him to continue his business into the new era and with new energy.
Opportunities for the buyer
These companies are a huge opportunity for corporate buyers. They get a profitable company. In addition, there is a transferor who, due to his age, can contribute innovative ideas and a high willingness to perform. In addition, he is extremely helpful in the handover, as the new situation gives him new impetus and joie de vivre. From our point of view, we recommend the appointment of a Advisory Boardthrough which the know-how of the transferor is used.
Consequently, a company sale does not always have to be for reasons of age or illness. Often a company is sold for other reasons, which should already be worked out in a good company exposé.
There are a number of risks lurking in the sale of a company. How you can skilfully exclude them is explained to you by KERN founder Nils Koerber in the webinar Company sale without risk and loss of value.
Tips for further reading:
Business sale vs. real estate sale
Advice traps in the process of business succession
The costs of a business succession or an M&A project
Company succession: Why a pure success fee makes serious advice difficult
Selling a company in the IT industry
Critical succession situation in NRW
The 5 most important contents of an entrepreneurial emergency kit
Younger entrepreneurs usually started their business very young. This means they can look back on a long time in their company. This entrepreneurial type of doer is bubbling over with creative ideas. And sometimes these can only be pursued in a new venture. That is why the sale of a company as a new start is often the only alternative.
For corporate buyers, such companies represent a huge opportunity. After all, the company is profitable and the young transferor is bubbling over with ideas. He is full of energy and helps with his know-how to sell the company successfully. After all, this step gives him new energy and joie de vivre. The best way to make use of these qualities of young owners is to set up an advisory board.
