In a linked in group, there was this question
Exit Strategy – Company For Sale?
What is your exit strategy when you receive a letter of interest to buy your company
One owner replied:
I started (Company) with selling the business as the exit strategy. I do not advertise that I am the owner and promote my employees whenever possible. Now I am selling the company I do not have the problem of the business relying on me. The biggest decision is to operate as an absentee owner or to sell to someone else.
To which I replied:
It sounds like you, Van, have worked to ensure success with promoting staff, etc.
It seems to me that whether one sells today or operates as an absentee, there ultimately is a need for an exit strategy. A business owner could say “well, it will be as absentee owned and, when I die, the estate will manage through a sale.” The potential problem in this is twofold: 1) The absentee owner may be wise (as Van suggests) to continue monitoring performance and occasionally step in to improve performance. If the owner becomes incapacitated, the entirety may collapse without intervention. 2) After death, the estate may not operate it well, until sale, and the heirs could lose the potential benefit. This is obviously all doom and gloom but worthy of consideration to ensure there are safeguards in place to meet each situation.
There is no one right answer. It is each owners decision based on the facts and resources at hand.
Find Jeff’s narrative at this link: Jeff’s Story