What to Do Before You Sell Your Business

Meet the Blogger

Sign up to Get The Free e-book

By Daniel Scott Johnson, Windfall Advisors

As an entrepreneur, you’ve put a lot into your business. Now that it’s time to sell, it’s time to get as much out as you possibly can. According to a recent article in Entrepreneur magazine, developing an exit strategy is something every business owner should do years in advance. However, most CEOs of privately held companies don’t think about how to maximize their sale price until they actually decide to sell. 

And by then, it may be too late.

In fact, in a recent Forbes article quoting Christopher Snider, president and CEO of the Exit Planning Institute, a company specializing in helping business owners sell their enterprises, most entrepreneurs are shocked to learn they can’t actually sell when they wish to—at least not at the price they imagine. And it all comes down to lack of preparation.

How unprepared are most entrepreneurs? Snider’s survey of 200 San Diego business owners revealed the following:

  • 53 percent said they had given little to no attention to a transition/exit plan (even though 75 percent were over 50 years old).
  • 88 percent had no written plan to transition from the current owner.
  • 70 percent don’t know what after-tax income they need to support their current lifestyle.
  • 40 percent had no idea what their business was actually worth.

Certainly, getting ready to sell should be part of any owner’s business plan from the start. Part of that plan must involve retaining the right financial advisor who can help you structure your sale for maximum profitability—and then create a plan to help you live comfortably off the proceeds.

Factors that a qualified financial planner, especially one who specializes in sudden wealth management, can help you navigate, include the following: 

  • Valuation and timing. As with so much in life, when it comes to selling a business, timing is everything. You want to time your sale to coincide with increased demand within your market segment to attract the maximum number of buyers and bids.       
  • Tax liability. Taxes governing the sale of a business can be quite complex, especially if real estate is involved. A strong financial advisor can help you structure a deal to minimize your tax liability and maximize your net take. (Also, if you are selling a commercial or investment property and you don’t necessarily need the proceeds, you may want to consider differing capital gains tax with a 1031 exchange.)
  • Portfolio diversification. Your business probably represents your single greatest investment. This always put you at risk. Once you sell, you have a chance to reduce your exposure by putting your assets in a variety of instruments. This is an area where sudden wealth management can be particularly valuable, as my mission is to help my clients create the foundation for long-term growth and security. 


Here’s yet another consideration you may not have contemplated. After selling your business, do you wish to retire? If so, you need someone to help you take a careful look at your assets and living expenses, then create an investment portfolio to produce the cashflow necessary to support the lifestyle you wish to enjoy. (The last thing you want to do is outlive your nest egg!) 

Perhaps you want to start a new business! Again, an experienced financial advisor can help you leverage assets from your sale to capitalize your new venture—and keep it running long enough to start turning a profit.

As the founder of Windfall Advisors, I possess years of experience helping business owners of all ages cash out of successful companies in ways to best maximize returns—while minimizing tax exposure. (I also know what it takes to create and grow a small business.) My clients represent successful entrepreneurs throughout California and the nation.  

So, why choose me as your financial advisor? Here are five key reasons:

  1. Experience. I have spent two decades in Wealth Management and Commercial Real Estate. When working for Merrill Lynch, I was part of a team that managed a fund possessing more than $1 billion in assets. 
  2. National Recognition. I have been interviewed live on CNN on the subject of sudden wealth management. I have also been quoted in articles written for CNBC.com, Forbes, and other leading news and financial media. 
  3. A Perfect Regulatory Record. I am proud of my perfect record of zero client complaints or regulatory dings. 
  4. Valuable Partnerships. My company works closely with Charles Schwab Inc. and eMoney Advisors, which has 12 Certfied Financial Planners (CFPs) on staff. Together, we provide clients with the fullest range of financial products, services, and support to protect and grow new-found wealth.
  5. Advice and Education. Importantly, I see myself as not just your financial advisor, but also your educator. I want you to fully understand the instruments in which you’re investing as well as the market factors that may impact performance over time.

If you’re a business owner contemplating selling your company, please take the important first step by contacting me today. Together we can make the end of this one journey the foundation for even more exciting ventures ahead.

Would love your thoughts, please comment.x
Scroll to Top