How to Help Your Team Thrive After You Exit

Have you ever stayed up at night wondering, "Will my team be ok after I sell my business?" You're not alone. Selling a business is more than just a financial transaction; it's an emotional journey that can leave you with countless sleepless nights. Let's dive into the three critical questions you must ask yourself before signing the deal. Getting clear on the answers to these questions can be the difference between a successful exit and a regretful decision.

What might be really at play when you think about selling your business?

Selling your business is not just about the numbers. The human factor plays a significant role, especially when it comes to your team. Here are three crucial questions you should ponder on your own before making any exit decisions:

• Will my team be ok?

• Are they not all going to leave after the sale?

• Will they fit into the culture of the other company?

Will my team be ok?

When contemplating selling your business, the wellbeing of your team should be a top priority. These are the people who have stood by you, helped grow your company, and contributed to its success. You can negotiate terms in the sale agreement that protect your team, such as job security clauses or retention bonuses. This not only shows your commitment to them but also provides peace of mind during the transition.

Are they not all going to leave after the sale?

One of the biggest fears for any business owner and buyer is the potential exodus of the team post-sale. Retaining your team is crucial for maintaining continuity and stability. These concerns should be addressed by you in conversations with potential buyers before making any announcements.

“Create a situation where your team wants to stay. Usually this is some kind of money paid out over time for staying” exited entrepreneur Nathan Hirsch

Consider offering incentives like retention bonuses or stock options in the new company. These can motivate your team to stay and continue contributing to the business's success. Show your team the opportunities that come with the sale, such as career growth, new roles, potential new projects or improved benefits. Position the sale as a step forward for both the company and its employees.

Will they fit into the culture of the other company?

Cultural fit is often overlooked but can make or break the success of a business sale in the long run. Ensuring your team will integrate well into the new company's culture is crucial. These concerns should be thoroughly addressed by you in meetings with potential buyers.

Step 1: Assess Cultural Compatibility

Before finalizing the sale, thoroughly assess the culture of the acquiring company. Look for alignment in values, work environment, and management style. Visit the acquiring company's offices and observe their working environment and culture firsthand.

Step 2: Facilitate Introductions

Once the sale is complete, arrange for your team to meet and interact with their counterparts in the acquiring company. This helps in building relationships and easing cultural integration. Buyers who plan to organize joint team-building activities or social events to foster relationships, show that the cultural fit is important to them too.

Smart Questions to Ask Potential Buyers

When evaluating potential buyers, it’s crucial to ask the right questions to ensure a cultural fit for your team. Here are some tactful questions you can ask:

• "What is your approach to integrating new teams into your organization, and can you share some examples of successful integrations?"

  This allows you to gauge their experience and strategies for smooth transitions, ensuring your team can blend well into the new environment.

• "How does your company support employee development, growth and achieved success?"

  This will give you insights into their commitment to employee well-being and career progression, which is important for your team’s morale and retention.

• "Can you describe the work-life balance in your company and any policies that support it?"

  This will help you determine if the buyer's expectations align with your team's current work-life balance, which is crucial for their overall satisfaction and productivity.

A Textbook Transition, by Tony

Let me share a story about Tony, a small business owner who sold his small chain of deli shops. From being in this business for a long time, Tony knew that attracting and retaining the best people was the most crucial about making this business work. So when he thought about selling, he was deeply concerned about his team’s future. He negotiated terms that protected his team and communicated transparently with all of them individually after the sale was finalized. He took the time to understand their concerns, ensuring his team felt valued and prepared for the transition. As a result, his team not only stayed but thrived in the new environment, contributing to the continued success of the shops under new ownership.

Reflect and Plan

Take a moment to reflect on these questions:

1. What are your biggest fears about selling your business?

2. How can you address these fears during the sales process?

3. What set of questions related to your team can you ask potential acquirers during the negotiations?

Write down your thoughts. Remember, the more prepared you are, the smoother the transition will be for everyone involved.

Read more on the topic of how remote teams influence business valuations and how your team can triple your exit price.

Selling your business is a monumental decision, but with careful planning and consideration for your team, you can ensure a successful and smooth transition. Your team has been the backbone of your business; ensuring their wellbeing post-sale is the best way to honor their contributions and secure the legacy of your work.