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Sad exit strategy

Steve Sink is the founder and managing partner of Phoenix Affiliates Ltd.

I was asked to meet with the owner of a forge company. The owner was a real gentleman and a very professional businessman.  He told me that he needed to sell his business within the next 3 to 4 months and wanted to know if I could help him.  

I reviewed the financials and pertinent information and found it to be quite profitable. So I asked him "What was the reason for the time frame"?

He told me that he had throat cancer and the doctors had given him that amount of time to live!  

We discussed the fact that a buyer would usually require the owner to stay on board for minimum transition period. And - the need to keep his condition confidential because if it got on the street, buyers would probably choose to wait out the situation. I told him that I would do the best that I could and took the listing.

Three months later, he had accepted an offer but passed away on his couch. Fortunately, he had kept his wife involved with the process and she made it through the closing process.

The sad part of the story is that the business did not sell for its true value vs. if the owner had taken the steps to do so. The good part is that the owner had done an excellent job of investing and the wife and children would not suffer financially.

The distressing fact to this story is that most owners have no exit strategy. 

 

Steve Sink

Certified Business Intermediary

ss@phxaffiliates.com

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