Ed Weeks breaks down what actually matters when selling your business: the headline price is misleading. Calculate your net proceeds after taxes, factor in earnouts and equity rollover, understand how long you'll stay on, and have a plan for the money before you sign.
Why would they all have the same answer? Take the owner who's deciding between selling and growing. Let's say he sells. Okay. How much does he actually walk away with after taxes and transaction costs? Does he have to roll equity? Does he have an earnout? Does he have to stay for 3 years? Who controls the company during those 3 years? What does his life look like after the deal? And here's one people don't spend enough time thinking about. What the hell is he going to do with the money? Because if you've spent 20 years getting really good at operating a company, selling it, and putting the proceeds into investments you don't understand particularly well isn't automatically a better financial decision. The number on the purchase agreement is only part of the equation.
