Big Deal Small Business: Ownership Transition Survey Results
March 17, 2022 | Issue #65
I’m in the midst of my ownership transition. I work with my sellers day in & day out. So far so good, with everyone playing nice in the sandbox.
The riskiest time for an SMB is around its founding, before it’s clear if it’s going to make it or not.
Arguably the second-riskiest moment is when it changes hands. Sub-$2M of EBITDA, businesses are generally an apparatus built around their owner (and their spouse).
The moment the business is sold, you’ve ripped out the company’s spinal cord. Yes, you’ll do your diligence on owner dependence, but the reality is that it is more dependent on them than any business you’ve ever worked in.
Anyway, those first few months post-closing are crucial. You’re learning from the owner. You’re transferring a million phone accounts, subscriptions, etc. You’re messaging the sale to employees. You’re explaining the situation to customers & vendors. It’s a lot to do, and a lot to get wrong.
So - my friend over at Brightleaf Holdings and I ran a survey of this readership base to examine best practices in ownership transitions. We’re sharing our results today - hopefully you’ll find a nugget or two in there to help you with your ownership transition.
Thank you to everyone who responded! Plenty of excellent insights, both quantitative and qualitative.
Those insights were expertly summarized by Brightleaf Holdings into a short report. Without further ado, here’s the link!
Enjoy the read. We’d love to hear your thoughts, disagreements, reactions.
Feel free to share by hitting reply to this email or hitting me up on Twitter.
Thanks,
Guesswork Investing