Proper Financial Planning for Selling Your Business | Mission Wealth Management

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welcome back getting started in business is one thing but what do you do after you decide to sell it that’s a question many probably don’t think about or at least should give more thought to and joining us to discuss this topic is Seth streer president and co-founder of mission wealth management thank you for coming in interesting topic here something people just don’t think about that’s why we have you here um when should somebody start thinking about this process well see like with any planning whether it’s retirement planning or funding your child’s college education or purchasing a home you actually should begin the planning process years before you actually ready to sell your business and the reason for that is there’s a lot of positioning and marketing of your business that’s important to make sure that the sale goes through smoothly and that the transition after can go through smoothly as well and maximize what you can get for your business exactly exactly and to make sure you set up your team of advisers often times business owners think they need to have a corporate attorney and maybe an investment banker

or broker but it’s important that they have their personal advisor in place as well a financial planner to kind of be the quarterback of the transition from business wealth to personal wealth as well as your tax advisers and an estate planning attorney are we talking about small companies the mediumsized companies anybody who own all siiz companies you know it’s amazing only 20 to 30% of all companies survive beyond the first year of business and only 10 to 15% of companies survive Beyond fif five years of business so it’s really any size of business if you’ve been able to be successful to get to a point where you’re ready to sell whether it’s a small oneman shop or a larger Enterprise um you make sure that planning goes into it okay so business owner build up the business they sell it what happen that a lot happens uh but to try to categorize it we found there’s really three General phases that business owners go through a look back phase kind of a present day assessment phase and then a look forward phase and I’d be happy to kind of share a couple blurbs on each of those phases yeah I was well say if you look I mean

if you sold the business what are you looking for I mean if you’re talking business-wise what should you be looking at well it’s interesting think it’s over look for you think it’s over but all of a sudden now all of a sudden you’re the business owner of your wealth so you’ve been the CEO of your company which you probably managed very carefully and now you have this event and all of a sudden you’ve harvested wealth what do you do so you now have to be a business owner of your wealth and you need to have a strategic plan you need to have a team in place and you need to make sure you implement that plan so the question is you got all this money you just sold the business what do you do well it’s interesting first people kind of look back and first they have a huge sigh of relief because it’s usually a pretty stressful uh you know process to go through but right after that point of relief they often feel a real sense of loss almost like losing a loved one because this business gave them purpose and meaning in their life and now they’re saying well what’s next so once they kind of go through a morning

process uh then they usually go through kind of a celebration and like I said very few people get to this point so they should really feel good about what they did and now start to look forward do you see just from your experience that many people I could understand the let down they they put their everything into this their their heart their soul into this business they succeeded they sold it they got their money they sit back in the house and they’re like okay what do I do right do you see many of them turn around and go back and start a new business absolutely it’s interesting because many business owners uh don’t have a lot of hobbies outside the business and so they have a lot of fantasy when it comes to I’m going to play golf and travel the world and you know pick up a new hobby and usually three months to a year after they sell the business they’re driving themselves crazy they’re driving their spouses crazy and they’re looking for the next Enterprise um so they’ve got to start this process all over again you said it’s stressful but they’re willing to jump right back into it and do it over

it’s part of their DNA often an entrepreneur it’s just in their blood to want to do it again but the key part is no matter what they’re going to carve off a portion of these proceeds hopefully to kind of current needs and some future planning needs so they can secure their retirement and at least one day work by choice if they want to keep working now so somebody’s gone through this process once they’re going to start going into it again how do they what do they do differently I mean how do they look at this differently they probably do I would imagine oh they absolutely do and they learn from each time hopefully hopefully we all learn from our mistakes and from our successes uh usually what they do is they try to treat it a little bit more detached for themsel they try to systematize the business a little bit more and set it up so it can run more efficiently when it comes to the management of their wealth from the first sale of their company they usually try to put the funds into categories so kind of immediate needs long-term needs taxes and I usually try to get them to Define what percentage of their wealth

that they’ve harvested they’re willing to reinvest into a new private Equity Enterprise so that they don’t put all the chips back on the table again into what can be a very Risky Business know we’ve talked about somebody who built the business up and sold it but what about about people who have never owned a business before M and they’re going they’re just kind of going through the weeds here trying to figure out what to do what kind of advice should you give them somebody who’s just starting out for the first time with regard to starting a business of their own yeah exactly well I think it’s important for them to know that it can be done and that many there’s a wonderful stories out there of many people that have been quite successful in starting their business so it starts with something that you’re passionate about don’t go into business because you think you can make money go into business because you care about something and you’re passionate and if you’re really passionate about something there’s always a way to make money so find find a cause or a purpose that you believe in and then find a niche and then go after

it all right well we appreciate it thank you very much what an interesting topic here this is something most people probably just would not have thought about how many business owners now are sitting around going oh my gosh I got to start over again all right say thank you Seth Seth streer here’s his information Mission wealth management the number there 882 2360 thank you for coming in thank you well