Permanent Podcast: Real Talk About Private Equity and Buying, Selling, and Operating Small Businesses
Preparation: When "Don't Sell" Is The Right Answer (EP.04)
Sep 23, 2019
Brent Beshore, an experienced business strategist, and Emily Holdman, a consulting expert, dive deep into why some business owners should reconsider selling. They dissect the financial pros and cons of selling versus retaining ownership, using a hypothetical manufacturing company as a guide. The conversation covers risk assessment, the complexities of deal structures, and the potential benefits of keeping a stake in your business post-sale. Their insights challenge the conventional wisdom about selling, making a compelling case for staying put.
07:34
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Quick takeaways
- Careful assessment of long-term financial implications is essential, as retaining ownership may yield greater overall earnings than a sale.
- Seller's remorse highlights the risks of relinquishing equity, urging owners to consider partial sales or partnerships to remain involved.
Deep dives
Evaluating the Decision to Sell a Business
When considering whether to sell a business, it's crucial to assess the long-term financial implications of each option carefully. In a hypothetical scenario presented, a business owner can either sell the company for a significant cash payout or retain ownership and allow it to grow steadily. Continuing to own the business could yield greater total earnings over time, potentially leading to a more substantial financial outcome. This decision involves not just basic math but also a deeper understanding of tax consequences, risk tolerance, and the potential for future growth, emphasizing the importance of careful evaluation before making a move.
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