You have realized that the time is right to sell your successful business, whether it is one that you have spent a good part of your life building, or one that is relatively new. In either scenario, you likely are emotionally invested in the fruits of your labor and financially invested in your equity and you have strong beliefs as to what someone should pay for your business. Prospective purchasers of your business, however, may not be on the same page as you are with respect to purchase price. Of course there is always room for negotiation, it’s part of the game, but you need to set your minimum ahead of time and be willing to walk away if that minimum cannot be met. This might be difficult, especially after you have invested a great deal of time and energy in marketing your business, plowing the due diligence process, getting emotionally invested in the whole process and the thought of receiving money of any amount.
Purchase price should not be your only deal breaker. Before you begin the process of marketing your company for sale, work with your advisors to set thresholds as to the maximum indemnification exposure you are willing to incur and what portion of the purchase price you may be willing to defer, decide if you are willing to sign a non-compete, and determine what other particulars are important to you and where you stand on them. If you establish your deal breakers ahead of time you will be better able to go through the sales process thinking with your head and not your heart.