One of the most crucial elements of running a successful company is having a stellar exit strategy in place. After all, most entrepreneurs don’t start businesses to spend their entire lives working from dusk till dawn. They do so to regain control over their professional endeavors, all the while making a profit that will help them live more comfortably.
But the thing about selling your brand is that it’s not always an easy feat.
In addition to finding a buyer, you also have to pay attention to a host of other elements. These include your company’s value, your employees’ fate after the sale, your customers’ future experience, etc.
And let’s not underestimate the difficulty of letting go of a brand you’ve built over years (or decades).
Considering all this, the last thing you want to do is sell out and let all your hard work go down the drain. So how exactly do you sell your brand without selling out? Is such a thing even possible? Let’s find out.
The Most Common Exit Strategies
As you plan on selling your brand, you’re probably wondering about the available exit strategies available to you. Well, for most startups, there are three that tend to work the best.
Initial Public Offering (IPO)
If you’re not afraid of doing the work required for impressive gains, then your absolute best is to go with an IPO. This strategy basically means listing your startup on the stock market and using that to gain capital, increase exposure, attract talent, and boost your brand’s image.
But, it also comes with a series of challenges. Listing your company on the stock market requires a detailed and transparent financial plan (which may require you to reveal company secrets to the competition). Furthermore, it demands constant work with considerable ongoing costs.
An alternative to going public may be to find a buyer (a competitor or a leading company operating in your industry). As this option is usually used by big names who feel like a synergy would allow them to gain more value over the years, a strategic acquisition may help you get more money from selling your brand.
However, the one downside of strategic acquisitions is that they relinquish the owner from all roles and responsibilities. For some entrepreneurs, this is a good thing. It allows them to move on to the next thing. But for others, it’s a big no-no, as it means that all their hard work may be undone.
Finally, for some business owners, the best exit is to sell their brand to management. While it may not always be the most profitable exit strategy, it can ensure that the brand goes to a group of passionate individuals who know the company inside-out and have a concrete plan for where they want to take it.
Valuing Your Brand
Selling your brand (partially or in full) doesn’t just involve deciding on the best exit strategy for your company. It also means approaching your entire venture with the thought of building value for all possible future scenarios – exit strategies included.
For example, if you’re a developer who wants to build and then sell an app, you have to understand that the entire process isn’t as simple as finding a buyer. It means addressing common consumer pain points, offering a great solution, and, of course, creating an exceptional product that will retain its value (and earnings) for years to come. By adopting this approach, you will ensure a high level of earnings for you and your team, as well as any possible future buyers.
Does Selling Equal Selling Out
So, you may be wondering – is it possible to sell your business without having to see it turn into something you never intended it to be?
The simple answer is yes.
But, a more in-depth look at the subject reveals that this type of approach requires looking at your venture from more than just a financial perspective. It’s not just money that makes a brand what it is.
Successful companies are made through dedication and hard work. And, perhaps even more importantly, they’re built with the customer experience and core values in mind.
So, if you’re looking to sell your brand without selling out, remember that you’ll probably have to make some sacrifices. And these will most likely be financial. Alternatively, you might have to find a buyer who is committed to the same things you are. Or, you might need to search for a unique solution that will allow you to retain some control over the direction of your brand. Understand, however, that this could mean more work for you in the future. The question is, are you ready to remain involved?
Is It Time To Let Go?
As you explore the possible exit strategies available to you (regardless of whether you plan on selling soon or years into the future), it’s not a bad idea to consider your long-term goals.
Is your intention to continue working on your passion project, giving it your all? Or are you, perhaps, looking for a way to equip yourself for a more comfortable and laid-back future?
If your answer is the former, then it might be worth holding on to a more involved position, even after selling your brand. This could be done by finding a buyer who’s comfortable acquiring only a portion of your business. This way, you can stay with the company and ensure it moves in the direction you set out when starting it.
However, if you’re looking to return your investment, free up time for different ventures, or simply want to remove yourself from a project that’s taking up too much of your time and attention, then it might be time to let go. You may have luck finding someone whose vision for your brand aligns with your own. But it also may simply be time to accept that companies and their directions change and do what’s best for you.
Yes, selling can take an emotional toll. But, ultimately, learning how to cope with some negative emotions and coming up with new strategies for your future (personal and professional) is surely going to be the better route forward. Especially if you compare it to sacrificing your wellbeing by tying yourself to a project that has lived its course (at least for you).
There comes a time in every entrepreneur’s life when they have to ask the question: what next?
To ensure that you’re not stuck between a rock and a hard place when that time comes, try to think about exit strategies as early on as possible. That way, you’ll have a clear idea of what will happen to your brand once you’re ready to sell it. And, of course, it will help you avoid the feeling of having sold out.
Lastly, don’t forget to accept that priorities change as we grow. What may have been important to you ten years ago when you started your company may not be in first place anymore. This is a natural process. So don’t feel pressured into doing anything just because it’s “right.” Instead, focus on finding the best solution for both you and your brand. Sure, it might not be a straightforward process. But you’ll be happy you’ve gone through it once everything is done and dusted.