Are You Ready to Sell Your Business? Why Founder Readiness Matters

You’ve done the hard yards getting your business in decent shape for a sale:

• Profits are strong.
• The management team can run things without you.
• Customer relationships are spread across the business.
• The numbers are reliable.
• A credible buyer has appeared and the offer is good.

This is exactly what you've been working towards, yet you're still waking up at 3am thinking:

“Oh God. Am I really going to do this?”

Because getting the business ready for sale and getting yourself ready to sell it are two different things.

Business owners can spend years doing all the right things: improving profitability, reducing risk and making their company more transferable, yet devote surprisingly little time to preparing themselves for what an exit will actually mean for them personally.

For a founder, selling a business is rarely just a financial transaction. It's also a significant personal transition.

What does it mean to be personally ready to sell your business?

Owner readiness is about understanding what you want from an exit, what you are giving up as well as gaining, what you may find difficult to let go of, and what you might want your life to contain afterwards.

Personal readiness isn't only about how you feel about leaving. It's also about having the clarity to make decisions about your future, the energy and capacity to navigate what can be a demanding process, and the willingness to make difficult choices about your business, your people and your own role. Where there are other shareholders, it also means understanding whether you're genuinely aligned about what you want to achieve.

It does not mean that you need to feel completely certain and delighted about all the things the future might bring.

You may still have doubts.

You may still feel sad about leaving.

You may be excited and apprehensive at exactly the same time.

In fact, after spending 10, 15 or 20 years building something, feeling absolutely nothing about selling it might be the more surprising response.

The question is whether you have thought about the personal consequences before they arrive.

Why can selling a business be so emotional?

For most SME founders, the business is not simply an investment sitting neatly in a portfolio.

If you founded the business, you had the initial idea and the belief to create something from scratch.

You made decisions when there was no obvious right answer.

You probably worked harder and paid yourself less than was entirely sensible at various points.

You hired people, lost people, won customers, lost customers, made mistakes, survived difficult periods and celebrated some brilliant ones.

Over time, the business becomes woven into your everyday life.

It gives you:

• a role
• a routine
• relationships
• status
• challenge
• purpose
• responsibility
• somewhere to direct your energy

It also gives you a very easy answer when somebody at a dinner party asks:

“And what do you do?”

Then one day, you sell it.

Financially, you may be in a considerably better position, but personally, a surprisingly large part of the structure around your life has just disappeared.

When you've spent years building a business that has become central to your sense of identity, leaving it can create a much bigger personal shift than you might expect.

This certainly took me unawares when I sold my own business. I hadn't realised quite how closely my identity and the structure of my life had become entwined with the business, or how much of a gap there would be afterwards.

“I feel lost” is a phrase I hear surprisingly often from founders I work with after exit. The deal may have gone well, but once the adrenaline has subsided, they are left working out who they are and what they want their life to look like without the business at the centre of it.

This does not mean selling your business will automatically plunge you into an existential crisis. There is, of course, rather a lot of upside and plenty of founders are delighted to leave their business.

It does mean, however, that the human side of selling deserves more attention than you might assume.

Are you ready to give up control?

Giving up control over decision-making is perhaps one of the biggest transitions following a sale.

As the owner, ultimately, you get to decide how things are going to be.

Of course, you listen to your team, advisers, spouse, board or whoever else has an opinion, but ultimately it is your business.

After a sale, that changes.

Sometimes immediately.

Sometimes gradually through an earn-out or handover.

Knowing intellectually that somebody else owns the business is rather different from watching them make a decision you strongly disagree with in practice.

Perhaps they change the brand.

Restructure the team.

Stop offering a service you worked so hard to create.

Ditch a supplier you have worked with for 12 years.

Set targets you think are ridiculous.

Or perhaps they run the business better than you ever did, which can be quite a blow to the ego!

All of these scenarios can raise uncomfortable feelings, which is why developing your ability to step back before a sale can matter just as much as developing the team's ability to step up.

What will happen to your team?

For founders who care deeply about their people, this can be one of the hardest parts of exit.

You may have worked alongside some employees for many years.

Perhaps they took risks alongside you.

Perhaps you know their families.

It is completely natural to care about what happens to them after you leave. It certainly was for me in my business, even though the financial considerations were important too.

But this creates difficult questions.

How important is protecting the team when you evaluate different buyers or exit routes?

What if the highest bidder is not the buyer you instinctively trust most?

What promises can realistically be made about jobs, culture and working practices?

What are you actually able to control once the business belongs to somebody else?

There are no perfect answers to these questions, but it is important to know how much they matter to you before you are deep into a sale process.

It may even influence who you sell to.

How ready are you for an earn-out or handover?

The dream version of selling a business tends to involve signing something, watching a beyond-your-wildest-dreams sum arrive in your bank account and walking triumphantly into your new life without a care in the world.

Reality can involve another couple of years at your old desk, but in a strangely familiar and yet very different context.

Earn-outs and extended handovers can make good commercial sense because they help reduce risk for the buyer.

At the same time, they can also create a strange psychological situation.

You have sold the business.

But you have not really left.

You may still carry substantial responsibility for achieving results while having less control over decisions than you did before.

You may report to a ‘boss’ for the first time in a long while.

You may be expected to support changes that would not have been your choice and communicate them with enthusiasm to ‘your’ team.

For me, it was having to add my holidays to the team holiday spreadsheet that really brought it home. (It's the little things!)

This is what I refer to as earn-out purgatory.

For some founders, it's perfectly fine. They enjoy the release from primary responsibility, or they just grit their teeth and get on with it.

For others, it becomes one of the hardest parts of the entire transition.

So when considering a deal, the question is not just:

“How much will I receive?”

It is also:

“What will be required of me to receive it?”

Do you need a plan for life after selling your business?

Yes and no.

I think it's useful to have thought seriously about what comes next, but I'm less convinced that you need to have your entire post-exit life mapped out before completion.

I definitely should have thought more about life after selling my business. But I doubt I could have created a meaningful, concrete plan because I didn't really know how I'd feel until I got there.

There can be pressure on founders to immediately produce a new five-year plan, but after years of running a business, you may actually benefit from allowing some space before committing yourself to the next enormous thing.

The important thing is to avoid assuming that the money and freedom created by the exit will automatically provide purpose as well.

Ask yourself instead:

What would I like more of in the next stage of my life?

And:

What am I curious about?

You may want another business.

You may want meaningful work without the responsibility of ownership.

You may want more time with your family.

You may have absolutely no idea yet.

That is fine.

You don't need to know all the answers, but it helps if you've started to ask the questions.

If you've already sold and are finding the adjustment harder than expected, I also work with founders as they navigate life after exit. You can explore my Post-Exit Transition support and book a free 30-minute Post-Exit conversation if you'd like to talk about what comes next.

How do you know if you are ready to sell?

There’s no definitive answer to this, but you might want to consider questions such as:

• If somebody made me an attractive offer tomorrow, what would make me hesitate?
• What am I most looking forward to leaving behind?
• What would I genuinely miss?
• How would I feel watching somebody else run the business differently?
• What matters to me about what happens to my team, customers, brand or legacy?
• How much involvement would I realistically tolerate after a sale?
• What do I want the exit to make possible in my life?
• Am I moving towards something, away from something, or both?

You may find that your answers are contradictory.

As a human, it's perfectly possible to desperately want freedom and still find letting go difficult. To be proud of the business and excited to leave it behind. To want the financial outcome and still grieve the end of an era.

Exit readiness isn't the absence of mixed feelings. It's having enough awareness of them that they don't take you completely by surprise.

Your business and you may be ready at different times

This is one of the reasons I look at business readiness and owner readiness separately.

A highly transferable, attractive business can have an owner who is nowhere near ready to leave. This disconnect can become even more complicated where there is more than one shareholder or founder.

Equally, an exhausted founder can be more than ready to exit while the business itself is not yet capable of supporting the outcome they want.

Neither problem is solved by pretending the other doesn't exist.

It can be useful to ask yourself both:

What needs to change in the business, and what needs to change for me?

Sometimes the answer requires three years of building management capability.

Sometimes it involves getting clearer on your financial needs.

Sometimes it’s becoming more comfortable with handing over control.

And sometimes it's simply giving yourself permission to acknowledge that leaving something you spent years building is a big deal.

Find out how exit-ready you are

A successful exit isn't simply about whether your business can be sold.

It's about whether the business can support the outcome you want, whether you're ready to make the decisions and lead the changes involved, and how prepared you are personally for what comes next.

The free Exit Compass Exit Readiness Assessment looks at twelve areas of commercial, organisational and owner readiness.

You'll receive your personal Exit Readiness Map, highlighting established strengths, areas that may need attention and where further information could help you understand your position.

And if you'd like to explore what the results mean for you, the 90-minute Clarity & Options Session provides an opportunity to consider your options and identify the priorities that matter most.

Because preparing properly for exit shouldn't just improve your chances of achieving a good outcome for the business.

It should also help you achieve an outcome that feels right for you.

Take the free Exit Readiness Assessment

About the Author:

Emily Potts is an exit strategist and transition coach, a former management consultant and an exited business owner. She spent more than a decade building and running her own e-commerce business, which she sold in 2017. She now helps owners of established SMEs explore their options, strengthen the value and transferability of their businesses, and prepare for what comes next.