Most business owners have dedicated the vast majority of their adult lives to building their businesses—committing years, sacrificing little league games, vacations, tee times, and sleep to follow their passions and achieve their goals. They have succeeded in creating jobs, new products, and a comfortable lifestyle for themselves and their families, giving back to their communities, and contributing to the local and national economy.
Most businesses start out as a labor of love without any thought of how, when, or even if it will end. Not surprisingly, caught up in the day-to-day management of the business, owners forget to ask-and-answer important personal questions that will have a great impact on how they will eventually transfer ownership of the business to others.
Here are some common personal disappointments we hear from former owners after exiting their businesses:
- “I thought they would keep me on longer as a consultant; I wanted to stay involved.”
- “I am not enjoying retirement as much as I thought I would… and I waited so long to do it.”
- “I never thought I would miss going to the office…but I do!”
Getting used to the idea of letting go or stepping away from your business may be the hardest thing for an owner to do. You’ve been in charge for as long as you can remember, answering questions, handling problems as they arise, and celebrating the successes of your business. When it’s finally time to step away, you may not be doing any of those things any more. In all honesty, you’ll become less important to the business and your industry, except perhaps in a legacy role. This can be extremely difficult to deal with.
So what can you do to prepare for your transition and avoid negative feelings afterward?
Business Transition = Life Transition
Seller’s remorse increases when you don’t have a good plan for what’s next. Financial considerations are important, of course, but we’re talking about your non-financial goals. It’s important that as you transition out of your business, you transition into something else that engages you.
First things first: Devote some serious time to figuring out what you want to do after you exit your business.
This can be tough. It will take time to separate your identity from your role in the business. Gradually spending more time away from the business, planning for this transition, can provide owners the time and space they need to envision themselves without their business. But there are some specific steps you can take, as well.
Steps to avoid regrets and disappointments:
- Allow sufficient time to work on your post-transition life plan; we’re talking 3 to 5 years of planning.
- Know your exit options and the pros and cons of each.
- Outline your criteria for a successful ownership transition.
- Be proactive; don’t procrastinate.
- Think about what you want to do after you exit.
- Document the goals for each area of your life.
Identify your fears, concerns, and other barriers and address them early. Preparing yourself emotionally for your business exit is the first and most important step. While it may be difficult to see at the time, you are more than just your business and you should consider each of the multiple facets of your life as you architect your transition plan.
Remember, business transitions are emotional events, even for those who are not usually emotional. Preparation ensures that you have a life beyond the company and improves your chances for a positive outcome.