We have worked with business owners for over two decades, and one of the most common questions we hear is, “When is the right time to sell my business?” The short answer: when it is doing well. The long answer is a bit more involved. Here, we have drawn from our years of experience to identify two key questions to ask if you are wondering “when should I sell my IT business?”
1. What do the numbers say?
The most important consideration in when to sell your business is its current financial state. You want to sell your IT business when it is doing well. Yes, this feels counter-intuitive. If your IT business is trending up and thriving, then won’t you get even more for your business if you just wait a little while? Unfortunately, we have seen that line of thinking lead to a mountain of regret for many sellers.
Countless times, we have valued an IT business at an attractive price, but due to a subsequent influx in business, the owner decides to hold off on selling. Then, a year or two later, the owner feels ready to sell… only to find out their IT business is worth less than it was before. What happened? Typically, these owners encounter an unforeseen circumstance like an unexpected downturn in the economy, the loss of a key client, or a change in their health.
We can sympathize with the devastation that comes with this type of scenario, especially after devoting so many years of hard work as an owner. Obtaining a professional business valuation provides essential information that allows you to make the right decision at the right time for you and your business. The way we value a business helps indicate the best time to sell the business. We consider financial trends over time, which helps determine a sales price and assures potential buyers that your IT business is stable or growing. Since we do not know what the future holds, we must focus on what we do know. Current and recent financials are the best indicators of where your business is headed.
2. What does your life say?
Perhaps your financials are in order, and on paper, it is the right time to sell your IT business. If you are ready to retire, the answer is quite clear. But what if you are not ready to retire? Thankfully, nearing retirement age is not a requirement for selling a business. There are certainly other priorities that can inform your decision. Maybe you have another investment opportunity you are interested in. Maybe a strategic buyer has shown interest in your company. Maybe life has thrown you a curveball and you need an immediate influx of cash. Any of these life stages or events could make for a good time to sell your business without necessarily requiring that you exit the business altogether.
We know you are inherently committed to the growth and success of your IT business. We also understand that as the owner, securing your personal financial stability and growth is completely tied to the business. That can be a demanding load, especially in today’s economic climate. Consider this: Viking has a massive network of thousands of pre-screened and pre-qualified buyers, including strategic and financial buyers looking for just the right business opportunity. Perhaps one of our buyers holds the right opportunity for you as well?
Bottom line: timing is key when it comes to selling any business. Do not be caught wishing you had acted sooner. Make a confidential inquiry today, and find out if it is the right time to sell your IT business.
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