Danny (not his real name) is a good friend from my days in business school. He and a partner launched a business in the late 80s. The partner left about ten years after they started, so Danny has carried 100% of the leadership responsibilities since. I remember him telling me when they launched that they didn’t have much of a business plan. But Danny had a sense they were on to a good idea, confident they were focused on a niche poised for growth. Suffice it to say, they were right.
In 2019, Danny started to think about his exit plan. The business was incredibly successful and quite marketable. After sorting through multiple offers, the sale was finalized in early 2020. Danny agreed to stay on for at least one year to facilitate the transition.
A couple of months ago, Danny texted me and said he had just announced his retirement with plans to be out by the end of this year. As we texted back and forth, we decided to plan a golf trip after the holidays.
But about three weeks after getting Danny’s text about retirement, he sent me another text, this one telling me he had just learned he had fast-growing cancer that carries a pessimistic diagnosis. To this very moment, I am having trouble dealing with this news. A few days ago, I made a trip to see Danny and we talked about the stuff of life, and how a diagnosis like this will make a person focus on what’s important, really important. “I should have sold five years ago,” Danny told me, “that way Linda (his wife) and I could have really enjoyed the lifestyle my business has afforded us.” I told Danny he had not made a mistake to wait, an owner has to leave on his terms when he knows he’s ready. After all, no one can feel bad about not being able to predict the future.
I will never tell a business owner it is time to sell their business. Any broker/investment banker who does is putting their interest ahead of the business owner. But I will say this, at some point, enough is enough. While staying on for more can be fun, especially when the business is doing well like Danny’s, be careful to not separate the quality of life from the desire to have more. Don’t let money be a trap for you. Time moves so fast, and it’s more valuable than money.
JIM CUMBEE is President of Tennessee Valley Group, Inc. a retainer-based business brokerage and transition mediation firm in Franklin, TN. Cumbee is an attorney and has an MBA from Harvard Business School. Jim is the author of Home Run, A Pro’s Guide to Selling a Business. https://www.amazon.com/Home-Pros-Guide-Selling-Business/dp/1599329239 . He has a wide range of corporate and entrepreneurial experiences that make him one of the most sought-after business transition advisors in the state of Tennessee. The principles above are true, but the names and fact patterns are changed to preserve the parties’ identities.
Tennessee Valley Group
Latest posts by Tennessee Valley Group (see all)
- That’s How We Do It In Our Industry - April 15, 2024
