Upon selling your business, the benefits of a successful sale most likely out-weigh any downsides. After closing, you should have a nice financial windfall to pad your bank account, less stress, and more leisure time to travel or spend time with family, for example.
I sold my conference and event company in 2012. In the seven years since, I’ve worked as a business intermediary, selling businesses for a multitude of owners. Each owner is different, but my experience of selling my own business, combined with the conversations I’ve had with previous owners during the months following their sales, has given me an insight into what I believe to be the five common benefits of business ownership that are missed upon selling your business.
- Having a Leadership Role
Many previous owners miss management; they enjoyed leading a team to create and implement strategies that increased sales, reduced expenses, or outsmarted the competition. After selling a business and removing themselves from the leadership role of being a boss and a mentor, many former business owners miss this important aspect of business ownership. One way to fulfill this need after selling your business is to volunteer with a non-profit organization and become an officer or board member. Rotary International, for example, is a great organization for former business owners, as it provides countless opportunities for networking and community involvement.
- Being the Face of a Brand
As is true with many business owners, their business becomes their identity. When people think of the business brand, they think of the business owner: they are the brand. Removing themselves from the brand that they built can be difficult for previous owners to adjust to once they sell their business. One way to eliminate the lost feeling that may accompany a sale is to keep active: take on hobbies, get involved with the community, run for local government, or even start a new career.
- The Social Aspect/Friendships
Most good business owners establish a strong bond with their employees. This makes sense: we spend more time with our coworkers than anyone. We share important moments in our lives with them, good and bad. Once a business is sold and the former owner moves on, they will not see their employees/friends as often as they did before and will miss the company gatherings that they used to have. When moving onto the next phase of life after selling a business, make sure to create new friendships and foster current relationships with friends and family.
- Medical Benefits
When deciding to sell their business, many owners forget to consider their medical benefits. For owners who are 65 years or older, losing medical benefits upon leaving their company is not as crucial, as they can collect Medicare. However, many business owners sell in their 50’s and don’t have this option, so they must find an alternative to their company benefits. Considering current medical insurance costs, replacing this lost perk can be very expensive. Some options for securing new medical benefits include joining a spouse’s plan, buying another business that has a plan in place or finding an (expensive) individual plan.
- Being Productive
Often, work is a business owner’s life. Travel or new hobbies may keep a former business owner occupied for a while, but this may not allow for them to feel as productive as they were when they owned a business. I don’t know how many times I’ve met buyers who are former business owners that sold their business, took time off, and decided to buy another business in order to stay active and feel productive. Instead of buying a new business, former owners can try to find their identity outside of their business, as mentioned in benefit #2: explore new hobbies, get involved in the community, or run for government office, for example.
Selling your business is exhilarating. If done correctly, you as the selling business owner should be able to successfully transition into your next phase of life. Yet, as the years go on, you will certainly miss some of the benefits. These benefits can be found outside of your business; learning how to navigate life after selling your business is simply one more step in the sales process.
This article was written by Sam Thompson. Sam is the president and owner of Transitions In Business, a Minnesota based M&A firm that specializes in selling healthcare, business to business, transportation, manufacturing, distribution and IT companies. Sam is a Merger and Acquisition Master Intermediary (M&AMI) and a Certified Business Intermediary who has successfully guided countless business owners through the sale or merger of their company. Prior to becoming an intermediary, Sam was a successful CEO and business owner for 29 years before selling his $16 million business.