The Emotional Rollercoaster of Selling a Business

Well, we've got a large closing coming up.  Its now imminent, and it

would now be hard to stop that train, so I figure its safe to write

about it without jinxing the deal. It is a sizable company, $7 million in sales and a sizable amount of

real estate.  I had the buyer lined up - almost a perfect buyer -

before it actually went on the market, so that part went very

smoothly.  Heck, we essentially sold this multi-million dollar business

in one week! 

However, it took seven months to close.  Financing was a huge challenge.  You see, the buyer was almost

perfect, but this was a large transaction and he was little light on

the millions it would take to make it happen smoothly. I created a loan

package in a 4" binder with our valuation, business plan, buyer

financials, seller financials, tax returns, etc. and I hit the bank circuit.  We got

a positive response, but 60 days later (not supposed to happen that late) the bank backed out - word was

the president didn't like this type of company.  I hit the circuit again and went through 10 binders.   Somebody must see this the way we

did!  We restructured the deal and went out again, and this time it

worked.  But working capital requirements meant more negotiations with

more banks.  Tax implications of cash vs. accrual accounting almost

killed the deal.  And so on.

All of this on-again-off-again weighed heavily on the seller.  I

spent some long evenings talking to him, and I know my partners did as

well.  He had employees that were becoming suspicious and worried.  His

wife was worried about the future in regards to health insurance, incoming loan

payments, etc. and he had to try to reassure her.  He had family travel

plans after the closing that were becoming at risk.  Oh, and his way of life

would change forever since the company that he built and identifies

with will belong to someone else.

I remember selling my own company and it is a difficult period of

time.  There are so many "moving parts" of the transaction, so many

things to worry about, that it becomes difficult to focus much on the

deal, much less anything else.

Even as a broker we can't help but get on that rollercoaster.  You

can't work that hard on a deal for seven months and not let it affect

you.  It affects my wife too: "Say, dear, are you ever going to get

paid for that work you do?".   But if I experienced the same emotional

swings as a business owner I'm not sure I would be able to do this job

in the long term - I'd have to take a month off after each closing to

recover.  We help the sellers and buyers through the process, and I

truly believe it helps to have gone through it ourselves with our own

businesses, but regardless I know there are some sleepness nights to be

had.

For this seller it is almost over.  He has some great trips planned

with his family, and I know from experience he'll finally be able to

relax and fully enjoy them.