18 - Selling a Business and What That Means

   Toni and Matt talk with John Thornton about the Business Assistant Microloan via The Catalyst Center. Brandon Kruse and Trey Sharp joins Toni and Matt to talk about their experiences in selling a business. Highlights (00:57) John Thornton summarizes the benefits of a Business Assistant Microloan (typically $5,000-$25,000) available to startups, early stage businesses, and established small businesses. (09:55) Trey Sharp and Brandon Kruse talk about their experience that led to them selling Sharp Communications and DialMaxx. (27:00) Brandon explains private equity acquisitions are likely to continue (outside of during significant recessions) with continual desire for companies that are generating $1 million+ in net profit per year. (29:43) Brandon explains the fear that a competitor will buy out your customers is silly. Customers leave because they haven’t been serviced, not because they’ve been marketed to better. (52:22) Brandon talks about the importance of knowing your business financials well. Otherwise, you tend to hit a ceiling and it’s hard to get to the next level. Summary The process of building a successful business is quite the challenge, but selling your business is no walk in the park either. Most tend to underestimate the time and effort required to prepare for a sale. Following efficient business practices (making sure personal and business expenses are always separated, running very clean accounting books) does make the acquisition process run smoother. Entrepreneurs today tend to be increasingly focused on the sale of their startup when they should be more focused on actually building a successful business that generates cashflow first. Selling your business when the stars align can bring peace of mind by trading ownership for an immediate return of your time (via payout of the projected returns of the business for the next 5-20+ years depending on market sector and position in the business cycle). The seasons of life often aim an entrepreneur toward another creative direction for a new venture, so selling a prior business can ease and accelerate that transition. There’s plenty of experts in the M&A space (M&A attorneys, veteran entrepreneurs) in the Huntsville area so don’t be afraid to reach out and ask questions as they can distill years of hard lessons into just a few minutes of your time.    Links The Catalyst Center Business Assistant Microloan info: http://catalystcenter.org/services/our-services/item/bam-microloan-program If you want a thorough sneak peak of everything that’s involved in selling your business, this prior edition covers most of the details for $6 shipped: https://www.amazon.com/Complete-Guide-Selling-Business/dp/1413312667 Last 30 year chart of global M&A activity: https://www.ft.com/content/b7e67ba4-c28f-11e8-95b1-d36dfef1b89a Rich Marsden (HSV M&A attorney Brandon mentioned who is very active in the HSV area): https://lanierford.com/attorney/richard-j-marsden