Before you decide to sell a company, you should decide whether you want to stay with it and for how long, or leave entirely.  There are strong benefits to you and the buyer if you remain involved after closing. If you are financing the sale, you’ll want to assure your investment is successful. Buyers, the business, and its stakeholders often benefit from such continuity, on-the-job training, and transfer of knowledge and relationships.

Often sellers remain with their business past any transition period in one of three capacities: as a consultant to the company and to the new owner, to run the business for the buyer or as part of a buyer’s larger organization, or take a seat on the buyer’s board.

The benefit to sellers is that they continue to contribute to the well-being of the company and its stakeholders, and can gradually forge a post-sale life. The new owner benefits by learning more, faster, with less risk, and by transitioning key relationships more easily. Of course, continuing with the business is not without its risk, as the following example from our experience illustrates.

Three partners had built a valuable company over time, and two of them had already decreased their work with the business prior to deciding to sell it. After the sale, they left the business entirely. The third partner, still working in the business full time, decided to stay with the company after it was sold.

Unfortunately, a technical glitch caused the business to lose a valuable long-standing client. Management should have been imposing tighter controls on the issue all along, but the inevitable problem happened under the third partner’s stewardship. He took it very hard and very personally. Loss of the client damaged the business financially and the third partner emotionally. He became withdrawn and eventually had to be replaced.

Our point? He could have left on a high note, one that would have given him a totally different experience and feeling about his life’s work. Don’t disregard the lesson and the questions that arise from it. How much do you really want to be responsible for your business after the sale? Should you hand the keys over now and take a victory lap, or risk financial and personal losses?

Go Where?

The “game” of business is a fascinating one that you may find difficult to leave. If your goal is to depart your company but stay in the business world, you should set aside time to explore starting a new business, buying a business, or landing a job at an existing firm. Many former owners are eager to find the next business puzzle to solve and an opportunity to reengage in the business arena. Others consider joining boards in the for-profit and nonprofit world. Choosing any of those alternatives would allow you to contribute your skills and network in a meaningful way without necessarily a full-time commitment.

Nonprofits hold a particular appeal for former business owners in that they allow you to pursue meaning over money. They may offer you the chance to reengage in a dream deferred, such as working for a cause that is important to you while being appreciated for the talent you bring. For yet other former business owners, selling the business represents an opportunity to choose impact over income by starting their own charities or foundations, or becoming active philanthropists.

Deciding to sell a business does not mean you have to leave it, but you do have to decide what you want.  If you have had to finance the deal, you may not want to leave the business and the fate of your money in the new owner’s hands.  However, we have heard from many business owners that say they want out.  Burnout or quite simply the DNA of the entrepreneur crying out at times for change.  Having the right exit strategy – staying involved for the time being and getting involved outside the business – will drive how to sell a business.

I invite you to use these ideas to make the decision best for you, and create your exit strategy.

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