Thinking of selling your business? Chris Worden sits down with Saul to discuss the realities of business exits, valuations, and the steps owners should take to maximise value and avoid common pitfalls.
- Understand the difference between lifestyle and scalable businesses
- Preparation and realistic expectations are key to a successful sale
- Culture, team, and assets drive business value
- Deferred payments and flexibility often required
- Trust and transparency are vital in negotiations
What Makes a Business Sellable?
Chris Worden highlights that most business owners overestimate their business value and underestimate the preparation needed. The distinction between lifestyle and scalable businesses is crucial: lifestyle businesses provide income and flexibility, while scalable businesses are built for high-value exits.
Key Steps to Prepare for Sale
- Get your financials in order: up-to-date management accounts and clear reporting
- Identify and strengthen your business assets: client base, contracts, brand, and team
- Reduce reliance on the founder—spread responsibilities
- Build a positive, stable culture to retain key staff
- Be realistic about valuation and deal structure
Common Pitfalls and How to Avoid Them
Unrealistic expectations, poor preparation, and lack of trust are the top reasons deals fall through. Chris Worden advises owners to approach the sale process as an investor would, focusing on risk and value drivers.
Valuation: What Buyers Look For
Buyers assess risk, recurring revenue, and the strength of your team and systems. Larger businesses with diversified income and strong management attract higher multiples. Deferred payments are common, so flexibility is important.
Case Study: Doubling a Business Valuation
Saul shares a story where simply improving financial controls and reporting helped a client double their sale price. Preparation and transparency made all the difference.
Key Takeaways
- Start preparing early—years, not months, before selling
- Focus on building transferable assets and a strong team
- Be open and honest with buyers to build trust
- Seek professional advice to avoid costly mistakes
FAQs
- What is the difference between a lifestyle and scalable business?
- Lifestyle businesses provide income and flexibility for the owner, while scalable businesses are built for growth and high-value exits.
- How can I increase my business valuation before selling?
- Improve financial reporting, strengthen contracts, build a strong team, and reduce reliance on the founder.
- What are the main reasons business sales fall through?
- Unrealistic expectations, poor preparation, and breakdowns in trust between buyer and seller.
- Is a lifestyle business sellable?
- Yes, but it may attract lower multiples and require more flexibility in deal structure.
- How important is company culture in a business sale?
- Very important—buyers value a stable, positive culture as it reduces risk and helps retain key staff.
Ready to discuss your business exit or need tailored advice? Contact us today for a confidential chat.
