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May 3, 2022The Emotions of Selling a Business
As a business owner, you’ve devoted your career to building a sellable business. At some point, you had an idea and decided to set out to make that idea a reality. You’ve endured the hardship and struggle of getting your business off the ground and, eventually, you had a thriving business. Throughout the years, you’ve experienced great joys and deep sorrows. And now, you’re finally ready to sell your business. But are you prepared for the rush of emotions that come with selling your business? After all, your business is an extension of yourself. Join me as I explore some of the emotions of selling a business and how to deal with them.
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TOPIC INDEX:
- – The Emotions of Making the Ultimate Sale
- – The Unexpected Weight of Emotion
- – Winning The Lottery
- – After the Initial Thrill
- – The Personal Side
- – How Will You Occupy your Time
- – Separating Your Identity From Your Business
- – Impression Management
Emotions of Selling a Business: The Unexpected Weight
I’ve often heard it said that experience is the best teacher. However, my dad used to say he disagreed with that statement. He believed that someone else’s experience was often the best teacher. Learning from someone else’s experience can allow you to gain wisdom without experiencing the pain or hardships that come with it. This reminds me of when my children were very little. I’d warn them not to touch the fireplace because it was hot. Inevitably, they would touch it and get burned, learning the lesson I had already tried to teach them.
Oftentimes, business owners go through life touching many fires. That’s why I’m addressing this subject. It is my hope that this entry serves as a caution to you. Friends, I want to prepare you for the unexpected weight of emotions that come with selling your business. Over the past year, I’ve walked with many business owners as they navigated the business sale process. Each one of them has experienced the full spectrum of emotions. So, I just want you to be aware of the emotions of selling a business before you enter into the process.
The Excitement
As you make the ultimate sale, it can feel as though you’ve just won the lottery. Years of patient diligence and hard work have finally paid off. For a moment, all of those feelings of being a fraud (imposter syndrome) begin to fade away. After all, you’ve built a business that is attractive to an outside buyer. And now that you’re on the verge of receiving the biggest payout of your life, you can allow yourself to indulge the ideas for the big ways you’re going to spend all of that money.
This is a very exciting time in the life of a business owner. It reminds me of being back in high school when the girl you really like begins to notice you. For a moment, it’s like getting that note back from her and seeing that she checked the “Yes” box. But I want you to notice that I’ve used a certain phrase a couple of times under this heading. For a moment. Your initial excitement will eventually give way to other emotions.
Melancholy and Nostalgia
As you move closer to closing, the excitement is still there but it shifts a little. Now, you begin to reminisce about your business journey. You can look at every part of your business and recall some story about how it got that way. In fact, I recently spoke to a business owner about this very thing. I said, “I bet you can tell me a story about every facet of your business; why you chose that particular color scheme, or what went into placing the furniture in its current layout.” He replied, “I can tell you I cut my thumb on that table as I was trying to put it together at 11:30 at night.” I guarantee you’ve got similar stories in your business.
While you’re going through this period of nostalgia, you’re thinking about each step of your journey. But you’re also thinking about all of the lives that have been impacted by your business. You’ve got past and present team members and their families. Each day, you poured into them in some way, whether you realized it or not. Likewise, your business affected clients and vendors. Maybe it was something small like finding a particular product that a customer really liked and making sure you always had it in stock. Whatever it may be, you and your business have impacted many lives.
And then it happens. You push through to the closing table and the transfer is completed. Your business is no longer yours. All of that nostalgia quickly turns to melancholy as you realize that your identity was staked in your business. It was a part of you and now it’s gone. When I sold my landscaping business, I remember waking up the next morning and thinking, “Wow! I’m unemployed.” I didn’t know what to do with myself. This can lead to a sort of postpartum depression. That can be very isolating because most people can’t sympathize with what you’re feeling. All they see is the financial windfall you’ve encountered.
Emotions of Selling a Business: Why Do You Feel This Way?
On the surface, it seems a bit silly that a business owner would feel depressed by doing what they’ve always set out to do. The goal was always to provide a living for yourself and then sell the business to fund your retirement, right? So, why do you feel this way? Believe it or not, a 2017 study by the University of Helsinki found that entrepreneurs are attached to their businesses the same way that parents are attached to their babies. This is why business owners become so defensive when you tell them, “Your Baby’s Ugly.”
Business owners love their businesses. Oftentimes, it’s a similar connection as with their own children. Now, that’s not to say that your business is more important or more loved than your children. It’s simply referring to the emotional attachment you have with your business. Think about it. You often go without so that your business can have what it wants or needs. You’re protective of your business and you pour all you’ve got into its betterment. There have been many sleepless nights where you wonder if you’re doing the best you can for your business. This sounds an awful lot like what parents do for their children.
With that in mind, it makes sense that 75% of business owners regret selling their companies. Folks, I’m not sharing this information to scare you away from selling your business. But I want you to be aware so that you can prepare for it. So, what can be done to combat the emotions of selling a business?
The Personal Side of Things
Knowing that you and your business will, one day, be separated, there’s a question you should ask yourself. How will you occupy your time? One of my colleagues asked this question from a slightly different angle. He said, “Justin if you had unlimited time and resources, what would you do?” I told him I’d like to go on a fishing trip and catch a large-mouth bass. I also said I wanted to spend a month in the mountains of Colorado, Idaho, and Wyoming to just be by myself in nature. Perhaps I would start a charitable foundation or an orphanage in the Philippines, where my wife’s family is from.
Maybe your list looks like mine. Or perhaps, you don’t want to do any of the things I mentioned. The point is that you think through these things before you enter the business sale process. Have a plan to occupy your time. This is an opportunity to redefine yourself. You see, your passions can cause conflict between your personal and professional life. That’s why the personal side of life is often a big reason business owners struggle with issues of identity and depression after selling their business.
Additionally, ask yourself why you’re selling your business. Are you selling it for financial reasons? Health? Is it just that it’s become too tough? The reason for selling your business can also weigh heavily in the emotional aftermath. If your decision to sell isn’t driven by money or fear, you could avoid the loss of identity and depression that often follow a business sale.
Impression Management: Fake It Till You Make It
As you’re dealing with the emotions of selling a business, you’re going to contend with another aspect. You’re going to have to convince your team that you’re making the right decision. Likewise, you must convince the buyer that you’re ready to make the sale. This can be challenging because, oftentimes, you’re not sure if you’re making the right decision, yourself. But consider this, 70% of small businesses fail by year ten. You didn’t. No. You convinced others to believe in you even when you weren’t 100% certain you believed in yourself. Therefore, this is familiar territory.
Finally, as you approach the close of your deal, you’re going to deal with one more emotion. Once again, you’ll need to tap into that impression management. Although, you may not know what the new vision will be after you’re gone, fake it till you make it. You have to sell your team on the new vision. I know you may not like this because it can feel dishonest. I’m not telling you to lie to your team. What I am saying is that you may have conflicting feelings about this because you love your team and you don’t want to put them in a bad spot. However, if you’ve done your due diligence and found a buyer that shares your core values, you should feel comfortable that they’re going to care for your team the same way you have all these years.
Wrapping Up…
Friends, selling your business is the goal. You should be excited about it. But you must be prepared for the rest of the emotions that come with it. Knowing what to expect can lessen the blow a bit. Especially, if you’ve taken the time to evaluate your motivation for selling and what you’re going to do once the deal is done. Look, I know life is hard. But life is good. Dealing with the emotions of selling a business can be frustrating. But it doesn’t have to be. By identifying your motivations and knowing who you want to be when you’re no longer a business owner, you can make handling these emotions at least financially simple. Hey, let’s go out and make it a great day!
Need help developing an exit plan that can put your emotions to rest? Reach out to our team. We are always ready to help!
