0 Items

The Factors To Consider When Deciding Whether To Sell a Start-up

The Factors To Consider When Deciding Whether To Sell a Start-up

I am a serial entrepreneur and I manage several different companies at the same time. Yesterday I posted the following request for help on my personal Facebook:


Cash in on a 160,000 profit by selling a start up (and get rid of many headache’s) or continue?

What would you do? How would you decide?

I received several answers, all really interesting and I therefore decided to consolidate them in a single article.

It seems that in deciding whether to continue with a start up or not, the following are the factors that should be considered:

I can immediately say that headaches are part of any start up and, more: they are that thing you have to cross in order to be successful. One of the main reason why many people in society have a weak financial condition is that they tend to abandon jobs and projects as soon as the first headaches appear. Many headaches = a lot of money. Or even better “If you want a business or a profession headaches free, you’ll stay poor”.

Lets see the factors that were indicated and that I found interesting:

ARE YOU STILL PASSIONATE? Do you still like it? Are you passionate about it?

CAN ITS VALUE INCREASE IN THE FUTURE? What is the long term value of the business? Is it possible tha even if it is giving you a lot of headaches, tomorrow its value will increase even more?

DO YOU HAVE THE NEEDED EMOTIONAL ENERGY TO CARRY ON? Do you still have personal energy that you can invest in this project?

IS IT PROFITABLE? DOES IT GENERATE CASH? For how long it will still be profitable?

DELEGABLE? Can you delegate it? (Can somebody else take care of it, while you work at other stuff?)

Last but not least:

What does your instinct say?

To all the above I think I can add one more, very important:

DO YOU HAVE THE RIGHT PEOPLE TO MAKE IT? Do you have the right people (or is it realistic to find/hire the ones that will be able to carry the business past the headaches). If the answer to this question is “no”, in my opinion you should sell right away.

I have to say that this exercise helped me understand that a factor I used to take into consideration was wrong:

If you give up, would you disappoint someone?

I am not saying this is totally to discard but, in talking with you, I came to realize that in the past my big attention to the above point has constituted one of my weaknesses as a business owner or as a person. Actually, often the very same people that I tried not to disappoint, have been the ones who left me in trouble. Much better to use the parameters listed above.

I will think a bit about this and will let you know my decision.

Thank you very much for your precious help.

Paolo Ruggeri