What Happens After You Sell Your Business?
When you sell your business, you accomplish a major life milestone. It’s the validation of years of hard work and sacrifice. The idea that you’ve built something with enough value that someone else wants to invest in it testifies to your success.
So what comes next? The period after you complete the sale involves more than just handing over the keys. Sure, in some cases, the seller makes a full and clean break. But in many situations, they may stay involved to help the new ownership complete the transition. Other details of the sale may also need to be finalized after the handover.
Here are some common steps that could take place after a business sale.
Immediate Transitions
Full handoff of your business to new ownership can take a few months, even close to a year. The buyers may ask you to have some presence in the business to maintain continuity. This could mean taking the role of a consultant, trainer, or even interim manager.
The details of your post-sale role are generally set during negotiations. Whatever they are, it’s crucial to set realistic expectations and timelines for your involvement in the transfer. The goal of all parties is to position new ownership for success, to genuinely empower them before you move on.
Financial and Legal Details
After you sell your business, you’ll have some financial and legal considerations to address. You’ve likely negotiated whether your proceeds will come in a lump sum, installments, or a performance-driven earn-out agreement. The tax implications of your earnings are substantial, potentially involving taxation on capital gains or income.
You’re also ushering in a new financial situation for yourself. This might require you to revise your estate plans or rebalance your investments to optimize future income. Legally, you may have to contend with non-compete clauses or other contractual obligations. Work closely with business brokers and legal professionals to sort out your responsibilities.
Identity and Emotional Changes
One underestimated facet of selling a business is the personal impact. Building a business from the ground up takes a lot of emotional commitment on top of hard work. It’s almost inevitable that you have allowed the business to comprise a major part of your identity. You will likely experience a sense of loss after you sell.
All of this is normal. But you don’t have to shed all of your identity or reputation. You can position yourself as a consultant or mentor to younger entrepreneurs who can benefit from your experience. You can address other ambitions, like travel or passion projects, that you set aside to grow your business. Or you can start another business venture altogether.
Plan for What Happens Once You Sell Your Business
The successful sale of your business marks years of hard work and stewardship. It also gives you the chance to reset and redefine what makes your life rewarding. It’s not the closing down of an opportunity — it’s the dawn of a new one. Post-sale steps to solidify and finalize your transition are part of the process of stepping into a new life.
