Ben T. Smith IV, co-founder of Merchantcircle.com & Spoke.com (btsiv.com), discusses the timing of selling your company. The tips provided will benefit you in the process of selling.
- Understand what you are selling- past results or future hope
- Ensure you can deliver to the very end of the deal
Assuming that you have moved past the point that I went through a couple of times with my companies of deciding I want to sell my company, then you have to decide when is the right time to sell it.
And it is not like one day you wake up and say, “I want to sell it.” You put a ‘for sale’ sign out the door and you sell it. Once you decide you wanted to sell it, you are really going to go into a fairly lengthy process, you know, it is certainly not a month and it may be as long as 18 months to sell your company. And there is a whole bunch of timing that really matters there.
One of the things you have to think about when you are picking the timing is are you selling past results or are you selling future hope as to what the company might be and you have to determine that early in the cycle as to whether you are selling results or hope.
In either case, you need to make sure you can deliver against that hope or those results all the way through a deal cycle. The last thing you want to do is enter a deal cycle and then have a hiccup halfway through because you are going to restart the entire process. It really have to take, quote, the house off the market for a while when you do that.
So you should never enter a cycle without knowing whether you are selling hope or you are selling past results and whichever one you are selling, you got to know that during the 6 to 12-month period, every week you are going to have some positive news either on results or on the hope of what you are building for the future. So decide whether you are selling for hope or past results and then make sure you can deliver against that and deliver momentum against those metrics all the way through the sales process.