Selling a business can be both a financial milestone and an emotional crossroads. Whether you’re nearing retirement or simply ready for a new chapter, the decision of when and how to sell your business can have lasting consequences for your wealth, your family, and your legacy.
In a recent episode of Dime After Dime, Moran Wealth Management® President Don Drury shared key insights on preparing for this pivotal transition, emphasizing that the most successful exits begin years before the sale itself.
Start Early: Preparation Creates Value
Many business owners delay exit planning because they’re focused on daily operations. However, waiting until the “eleventh hour” can limit options—especially during unfavorable market cycles or economic downturns.
Drury recommends beginning the process five to ten years in advance, allowing time to strengthen operations, identify successors, and clarify your long-term goals.
Businesses that function efficiently without relying on their founders often command higher valuations. According to the Exit Planning Institute, roughly 80% of business owners have no formal transition plan, even though most of their personal net worth is tied to the business itself, making early planning critical for preserving value.
Understand Your Options: Family, Management, or Market
Exiting a business isn’t a one-size-fits-all decision. Drury outlines three primary paths:
- Family Succession — Transitioning ownership to the next generation requires both financial and emotional preparation. While this may preserve legacy, it’s essential to establish fair valuation methods and financing structures that ensure the transaction remains sustainable for both parties.
- Management Buyout — Empowering internal leaders to purchase the business can promote continuity, but only if they have the financial capacity and desire to assume ownership. Gradual equity transfers or share-based compensation can help bridge the gap.
- Third-Party Sale — Selling to a private equity firm, competitor, or industry consolidator often requires the most preparation. Buyers seek stable cash flow, documented processes, and scalability.
Manage the Human Side of Transition
Beyond financial considerations, exit planning involves communication. Drury stresses that transparency with employees and clients prevents uncertainty and maintains business stability during negotiations.
For family businesses, thoughtful communication can also reduce misunderstandings among generations about ownership, responsibility, and inheritance.
Don’t Overlook the Tax Implications
From choosing between an asset sale and a stock sale to managing the timing of proceeds, tax strategy is a core component of any exit. Working with both a CPA and financial advisor can help business owners model different outcomes before signing a contract. As Drury explains, coordinating sale structure, reinvestment strategy, and income replacement can mitigate tax impact while aligning with retirement goals
Life After the Sale
Perhaps the most overlooked challenge is psychological. After years of defining success through their business, many owners struggle with a sense of purpose post-sale. Drury notes that this transition often requires as much personal planning as financial restructuring. Establishing new goals, whether philanthropic, professional, or lifestyle-oriented, can help transform proceeds into purpose
The Bottom Line
A successful business exit doesn’t happen overnight. It’s the result of strategic foresight, sound financial modeling, and clear communication with all stakeholders. Whether your timeline is near or distant, beginning those conversations early can position you for both stability and opportunity when the time comes.
If you’re a business owner considering succession or sale planning, our team can help you evaluate timing, structure, and reinvestment strategies tailored to your broader financial objectives.
Schedule a conversation with a Moran Wealth Management® advisor to explore how proactive planning today can prepare you for tomorrow’s transition.
Sources:
Moran Wealth Management, LLC (“MWM”) is an SEC-registered investment adviser. Registration does not imply a certain level of skill or training. This material is provided for informational purposes only and should not be construed as personalized investment advice or a solicitation to buy or sell any security. For additional information, please refer to our Form ADV at adviserinfo.sec.gov.