Selling a Company: It’s Not Just Business, It’s Personal
As ready as they might be for their PuroClean franchise’s sale mentally and financially, Ed and Sonia Ketchoyian soon found out that preparation is multifaceted and that there is one aspect in selling that they were not ready to handle—their emotions.
“This is more than just a business transaction, so there are certain emotions that came to play at the end that I wasn't quite expecting,” Ed said of their business, which specializes in emergency restoration services for residential and commercial properties damaged by flood, fire, and mold.
Having run the business for over eight years, Ed explained that an owner is bound to have strong feelings when exiting a business he has put a lot of time and effort into for years, regardless of how the business has been doing.
“Once you get into a business as an owner, your emotions become involved because it's just the nature of small business ownership. You end up putting a lot of yourself into it,” Ed said.
Breaking the news of the sale to the employees became especially tough for Ed because he could not reveal that they will be working for a new owner until they were certain that the deal will push through.
“That was difficult. We were working with the owner for months and we couldn't reveal anything that was going on... [until] we were absolutely certain the deal was going to happen,” Ed recalled.
Less than a week before the closing date, the couple told their employees, who did not receive the news positively. Ed and Sonia had to assuage their fears and reassure them that the new owner did not want to change anything and that they were not going to lose their jobs.
“Everybody was very surprised. ‘Shocked’ is a strong word but they really had no idea that we were in the process of selling… Change, in general, is not a welcome thing,” Ed said.
Overcoming emotions and other advice for business owners
How did Ed conquer the wash of emotions that went through him during the closing?
He reminded himself that he is a separate entity from his business and that who he is as an individual is different from his business.
“Sometimes for a small business owner [it’s difficult] to realize your identity is not your business and you're a separate person… It's good to keep that perspective and be able to separate,” Ed shared.
Apart from telling future sellers to detach from their business, Ed also advises them to:
- Be patient. “[Selling a] business is not going to happen overnight. Just keep a long view perspective on it.”
- Keep the sale confidential. “...If the buyer were to back out before the deal closed after we told employees, there'd be instability and it would just not be a good thing. So we had to wait.”
- Keep your eyes on the prize. “If your goal is to sell your company at a price that you're happy with, you have to be able to move beyond little bumps on the road that might distract you from getting there.”
- Try to view the sale as a business transaction. “Valuing your company can be an emotional thing, obviously.” However, he said, “It’s a business transaction and try to approach it that way.”
The right intermediary can help you cross the finish line quicker
“Morgan & Westfield helped a lot in the final phase of putting together the agreement… it was a very efficient process. [They] gave us very quick turnarounds in the timetable that we had, and I was pretty satisfied,” Ed said.
Aside from finding value in Morgan & Westfield’s efficient process and legally sound closing documents, Ed also considered the following benefits:
- Business Summary sent to prospective buyers. Morgan & Westfield created a Business Summary that is meant not only to give prospective buyers an overview of Ed’s business but to also pique their interest and move them to take the next step in buying the business.
- Advice and guidance provided throughout the process. Because selling a business is unchartered territory for Ed and his wife, Morgan & Westfield guided and assisted them from valuation to closing.
- Reasonable rates for services. Ed believed that Morgan & Westfield provided services at very reasonable rates. He added, “We paid for different aspects of services that we got, but the value in what was provided was very good.”
“I never met with anybody from Morgan & Westfield face-to-face and it wasn't necessary. We did all our correspondence by email and phone conversation, and that worked out just fine,” Ed explained.