Last week I sold my favorite car. It was a 1998 Audi A4 Quattro with only 110,000 miles on it. It lived for 10 years in Boulder, and then 10 years tucked in a rust-safe garage at our beach house in San Diego. It was pearl white with creamy leather seats and barely a scratch or dent on it. A five speed, 2.8 liter, it was a blast to drive. The last week with it, I drove it 1,600 miles, via Arizona and New Mexico, back to Colorado where a very excited 16-year-old looked forward to buying it — her first car!
How ironic that the drive, as well as preparing the car for the journey and for sale, rekindled my love for it. Rationally, I knew it was time, and that it was going to a good owner. So what made this such a poignant event?
As I thought about the question, it occurred to me there are parallels for business owners in this handoff that was anything but just business.
Three Stages to a Great Handoff — 3 P’s
When you love something and take pride in it, how do you let it go? I think you do three things conscientiously — with thought that comes from that well of love and pride. You prep the vehicle (or business); pick the right buyer carefully; and take the time to prepare yourself.
Prep the Vehicle
As a point of personal pride I wanted the car to be in the best possible shape. I had it inspected by Audi. Then I made some repairs, had it tuned, and bought new tires. I felt confident in its future performance.
But that wasn’t enough. My car also had to sparkle. We personally did a complete detail cleaning from exterior waxing to leather and carpet cleaning and even shined the tires. I collected 20 years of maintenance records into a folder and organized owner’s manuals. I imagined my young friend (and her parents) needing to feel confident in what they were buying as well as wowed by its appearance.
As a business owner we do the same in a sale to bring out the full value. We stand in a buyer’s shoes to:
- take a hard look to find where we can make improvements to ensure process reliability, equipment quality and that our people are at their best;
- examine the physical appearance of the business from bathrooms, storage rooms and offices, to carpets, walls and windows;
- ensure our records management produces the information that gives a buyer confidence in the business operations, legal compliance and financial performance.
Pick the Right Buyer
Searching for and picking the right buyer is grueling and emotion-laden. I met an owner whose reflection on the sale of her business was, “It was a great deal except I sold it to the wrong buyer.”
I asked myself the following, and you might too:
- Who will value my car’s (company’s) capability and see what it can do for them, i.e., is it a good fit?
- Who has the skills and mindset to run it vs. run it into the ground?
- Who can come through with the funds?
Of course there are other significant questions to qualify a buyer and to determine the best buyer profile. I hope you will read about these in my book Exit Signs.
Prepare Yourself
The hardest part of planning for a sale is preparing you. There is often a sense of loss and/or apprehension. What helped me was deciding to focus on what this car would mean to a 16-year-old young woman about to get her license. I recalled my excitement for my first car as I headed off to college. How great it was to participate in a similar moment and share that excitement again. Did I have a lump in my throat as I handed over the keys? You bet!
Coincidentally, I was told a story last week about a boomer owner who had recently sold his landscaping business to a young millennial. He came back for a visit and exclaimed about the amazing energy he observed around the place. He could see the renewed potential, and it was gratifying. Might there have been a twinge of longing? Probably.
Then drive on…
When I sold my business I would drive by my former office building on my way home and automatically look up at my corner office. It took about a year before I drove by without looking. I’m glad my old Audi is driving around a town an hour away so I don’t find myself looking for it. Funny, how turning over the keys can be filled with such sentiment even if it’s just a car. Interesting, even when we diligently prepare that car or company, it’s still a part of us long after the handoff.
Trust me though; it’s that preparation that lets you drive on.