Business owners don't have to sell to move on. You can bring in capital, take partial cash out, hire a strong manager, or acquire competitors. The real question isn't whether to sell but what you actually want to achieve and what trade-offs you'll accept.
That's why I've become somewhat obsessed with this idea of owner optionality, not as some fancy finance term. And then there's the territory between those 2 answers. That's the part I think gets interesting. What if you don't sell the whole company? What if you bring in capital? What if you recapitalize the business and take some chips off the table? What if you find a strategic partner who brings something besides money? What if instead of selling to the company buying everybody in your industry, you acquire 2 smaller competitors yourself? What if you promote or hire somebody capable of running the day-to-day business and change your own role? There are trade-offs to every one of those. Capital isn't free. Partners aren't free. Debt isn't free. Giving up equity isn't free. And keeping 100% ownership of a company that requires 100% of your life isn't exactly free either. That's the analysis. Not should I sell, but what am I actually trying to accomplish? And that's why I've become somewhat obsessed with this idea of owner optionality, not as some fancy finance term. I mean something really simple. How many good choices do you have? If you need a lender tomorrow, can somebody understand your financials? If an acquisition opportunity shows up next month, can you finance it? If somebody offers to invest in the company, Do you understand what you're giving up if you disappear for 3 weeks? Does the company continue functioning? And if a buyer calls, can you evaluate the offer without panicking?
