Your “After” Affects Your “Now”

What does knowing what you will be doing after your business sells, have to do with preparing to sell your business? A lot, if you would like to be able to sell for more value.

In preparing a business, and the business owner, to sell their business, I have always started by asking, “what do you hope to be doing after?” It wasn’t until I was at a CAPS event in Toronto, when I heard a statement, that M&A companies find it hard to sell a company when the owner doesn’t know what they will be doing after they sell. This was a huge statement, that was unsubstantiated by the speaker, so I had to go digging to do some fact finding. What I found supported my understanding and his statement.

I want to point out three reasons in this article, that you should understand what you will be doing after your business is sold, so that you can get the most value and most opportunities for the sale of your business.

1) No Vision = No Value

Without future vision, we cannot perceive the first step (or steps) required to reach tomorrow’s goals. To do what has to get done, we need to know what needs to get done, in which order, and by whom. With no plan to reach the unknown future, the future remains unknown.

OK, I think you get where I’m going here. You need a plan to get your business ready and that includes, how it can successfully run  without you. In an article from Financier Worldwide Magazine[1] “Planning 3-5 years in advance can maximise value and ensure a smooth transition.”

Simply arriving at the end of your time, does not give you any options for getting out with value, nor having any potential value for the next owner.

2) Post-Sale Continuity

One of the biggest values you can offer for the potential buyer is to create continuity in the pre- and post-sale operations. This means, you need to know how your business will run once you are gone. Will you walk away completely as the sale closes, and leave the team to manage the transition to the new owner, or will you be part of that transition. Do you leave with all the knowledge or does the business hold the knowledge in their people, systems, and SOPs? Can the new owner expect continued sales and aligning with projection, or will they have challenges meeting current sales numbers?

Don’t take all the intangible assets (e.g. those things that only you can do) with you when you leave the business. Create a plan to leave your intangible assets with the business, so the business can thrive without you.

3) Increased Buyer Confidence

Knowing what the seller is going to be doing after the sale, increases buyer confidence by ensuring that the future of the business has been structured in a way that will survive the transition. But this is also true of the buyer. If the buyer does not identify their intentions and is vague about their plans, this can also affect the sale. The saas.group suggests, ” if the potential acquirer is vague about their plans for your company after the acquisition, it could be a sign that they are not fully committed to the deal.” [2].

Preparation ensures that you, as the seller, knows what your business will be doing, what it is worth, to you and to the buyer, and what you expect of the buyer, so that the buyer can easily see what they are buying, how they  fit, and what their future will look like. You will be able to also better identify if the buyer is a good fit for the business and for the sale.

Finally

M&A companies recognize the value of a seller knowing their future before, during, and after a sale, and so should you, as the seller. Make your ‘NOW’ actions more effective so your “AFTER” is more valuable.

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References

[1] 2025 High-value M&A exits: cultivating buyer interest – Financier Worldwide Magazine

[2] 2023 Startup Acquisitions: Finding the Right Buyer for Your Company

      n.d. 10 Biggest Challenges During M&A & How to Overcome Them

      2024 How M&A Can Affect a Company