Watch the webinar for business owners considering an exit.
Wind in your sales
Coming off an active market for mergers and acquisitions, the latest 麻豆社 Investor Watch looks at business owners who now face headwinds from higher interest rates, inflation and political uncertainty. We spoke with owners considering an exit and those who recently sold their business.
Among current business owners, we found that many fear they missed their best chance to sell. But experts advise that opportunities still exist and the key to attracting the right buyer is to plan ahead. As for business owners who recently sold, most wish they鈥檇 taken more time to prepare. They鈥檇 agree: start planning now to be ready when the winds shift and opportunity arrives.
Business owners are concerned about valuations in the current market
Many worry about getting a fair price 鈥
鈥 and regret not selling sooner
Highly concerned about a lower business valuation in current economy
Regret not trying to sell or exit business sooner
How they intend to exit
23%
- Strategic buyer
21%
- Private equity
10%
- IPO
17%
- Partner or management
13%
- Next generation
6%
- Employee Stock Ownership Plan: (ESOP)
Expert insight
Are you exit ready? Sign up and we鈥檒l help you take a realistic look at where you stand today
While the macroeconomic environment is weighing on overall M&A activity, there continues to be a bid for high-quality, resilient, cash flowing businesses.
Advanced preparation is key for taking advantage of future market windows
Oliver Henderson, Managing Director, OneBank Coverage, 麻豆社 Investment Bank
Yet many business owners aren鈥檛 properly prepared to sell when the time is right
They have not taken steps to sell 鈥
34%
- Have not identi铿乪d professionals to help 铿乶alize the sale
34%
- Have not put structures in place to help minimize taxes and shield proceeds
31%
- Have not completed a business valuation
鈥 or transfer their newfound wealth
40%
- Have not engaged heirs in dialogue about family wealth
37%
- Do not have an estate plan
31%
- Have not identi铿乪d a plan for what to do with the proceeds
And business owners who sold underestimated the time needed to prepare
Most spent less than two years preparing for the sale 鈥
% who agree
-
73 %
Spent two years or less preparing to sell their business
32%听Less than 1 year
41% 1-2 years
鈥 and a vast majority regretted not preparing sooner
-
81 %
Wish they had spent more time preparing for a sale
Expert insight
Sign up to get our guide:聽Planning for the sale of a closely held business
Before engaging an investment聽banker or soliciting interest,聽educate yourself on potential tax聽strategies. Decide whether any聽ownership interests should be聽transferred to family or charity聽so they can also benefit from聽the transaction.听
As for timing, the earlier the聽better. We often work with聽clients years before a transaction聽to get them, their businesses聽and families prepared for a sale.
Ann Bjerke, Managing Director,聽Head of聽麻豆社 Advanced Planning
When selling, business owners consider more than just the sale price
Business owners have concerns beyond the sale
% worried when giving up ownership
87%
- Buyer won鈥檛 treat employees well
85%
- Won鈥檛 have as much of a sense of purpose
84%
- Don鈥檛 agree with direction buyer will take the business
But they look forward to new opportunities
% greatly look forward to the following
73%
- Traveling and spending time with friends and family
52%
- Start a new business venture
45%
- Giving back to community or charitable causes
Expert insight
Learn how business owners who successfully transitioned to life after the sale of their business
A successful post-sale road map聽often requires owners to聽redefine their purpose as well聽as roles and responsibilities聽for themselves and family聽who will be involved in new聽philanthropic or entrepreneurial聽pursuits.
Heather George, Executive Director/Senior Strategist,聽麻豆社 Family Advisory聽& Philanthropy Services Americas
Most business owners who recently sold sought advice from their financial advisor
Who they turned to
66%
- Financial advisor
35%
- Accountant
33%
- Lawyer
32%
- Family
28%
- Business broker
Expert insight
Thinking about selling your business? Sign up for our three-point plan
For many business owners, their聽business encompasses how they聽spend their time, their social lives聽and purpose.听
Talking about these factors with聽an advisor when constructing a聽financial plan is integral in getting聽emotionally and financially ready聽for life after a business.
James Jack,聽Divisional Sales Manager, 麻豆社 Private Wealth Management Division (East)
Plan early and seek the advice needed to take action
It鈥檚 never too early to plan, but it can be too late, especially to maximize net proceeds. Strategic planning and tailored solutions, including financial and investment banking expertise, can help throughout the lifecycle of a business.
With the right guidance, business owners can proceed with passion and exit on their terms, embracing their future with new enthusiasm.
