Nate Collins is a Financial Advisor at Raymond James. He works with a select number of business owners and their families to help achieve their financial goals. Nate provides in-depth tax-mitigation strategies and estate planning, as well as comprehensive family-office services. He helps owners understand exit readiness, maximize wealth transfer, gain family alignment, and prepare for “life after exit.”

nate.collins@raymondjames.com
203.635.5420

BUSINESS OWNERSHIP

Two entrepreneurs share how to best navigate a business sale.

On the Business Exit Insights podcast, we spoke with Joe Covey – a media, healthcare, and education entrepreneur who has bought and sold many businesses – and Rob Delf – a software entrepreneur in the media and entertainment space, who is currently CEO and owner of Fabric. These successful founders share their experiences of success and some of the challenges they have faced.

Here are 5 lessons that these two entrepreneurs want to share with you.

5 Lessons

1. Identify the Right Time to Sell: Covey emphasizes the importance of timing in selling a business. Drawing on advice from billionaire Jimmy Goldsmith, Covey highlights, "I always sold too soon," underscoring the risks of selling too late when the business might be declining.
2. Surround Yourself with a Strong Team: Both Covey and Delf stress the significance of having a good support team during the sale process. Covey advises, "Surrounding yourself with good people," including legal, financial, and technical experts, to navigate the complexities of a business sale. Delf echoes this, indicating the importance of patience and seeking advice to navigate the complex and often lengthy process.
3. Prepare for Operational Continuity: Covey warns against taking your eye off the operational ball during the sale process. Maintaining business performance according to projections is crucial as failing to meet these can lead to lowered valuations.
4. Transparent Communication with Employees: The The balance of how much to share with employees during the sale process is delicate. Covey highlights the need for a certain level of transparency to avoid unnecessary panic and ensure operational focus. Delf also notes the importance of understanding the implications of different transaction structures, particularly how they impact both the seller and the business post-sale.
5. Personal and Identity Considerations Post-Sale: Both entrepreneurs share personal insights on the impact of selling a business on one's identity and life balance. Covey suggests using the post-sale phase as an opportunity to reconnect with personal interests and relationships. Similarly, Delf reflects on the identity shift that can occur post-sale, advising sellers to consider their long-term happiness and identity beyond their business.

In summary, these lessons from serial entrepreneurs offer valuable perspectives for business owners considering the sale of their ventures. They underscore the need for careful timing, strong support networks, operational diligence, transparent communication, and personal well-being throughout the sale process.

Contact Nate Collins at nate.collins@raymondjames.com to discuss your business exit plans.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Nate Collins and not necessarily those of Raymond James. You should discuss any tax or legal matters with the appropriate professional.

Raymond James is not affiliated with and does not endorse the opinions or services of Joe Covey or Rob Delf.