If the idea of selling your startup seems appealing to you, are you sure now in fact would be the time to do so?
Selling a small business can come with some challenges. That said having all your ducks lined up in a row and finding the right time to sell can mean success for you.
With that in mind, what might make you consider selling now?
Is the Timing Right for a New Challenge?
One of the main reasons people sell their startup businesses is that they seek a new challenge. If this sounds like you, what is that next challenge going to be?
You may be at a point now where you feel you’ve maxed out all the potential of your small business. As a result, the fire and desire you’ve had for the business may not be there any longer.
It is important to note when considering selling that you want to try and sell when the timing is right.
That would be that the industry your small business represents is doing well. Trying to sell during a struggling marketplace can mean a tougher sell and less money for you.
Take the time to analyze the industry marketplace. Look to see if businesses like yours are in fact selling rather fast and for decent profits.
If you have a Software as a Service (SaaS) operation, do your homework. That is to see how this segment of the business marketplace is doing now.
According to leftronic.com, the industry is expected to generate close to $160 billion by 2022.
One thing to look at would be how SaaS multiples figure into the equation.
Review things such as how sustainable your SaaS is for a potential buyer. Also look at your revenue trends in recent years. Another factor in play would be your role in the company and how hands-on or off you are.
By reviewing those and other multiples in play, you are in a better position. This would be to determine if selling now makes sense or you should hold on to what you have.
Know Who May Be Buying Your Startup
Even though you and your startup will be reviewed by any possible buyer, you should do some reviewing too.
When you have poured time, effort and money into your business, chances are you do not want it being sold to anyone.
The buyer or buyers should be those who will take your startup and continue down the path of success that you set it on. Selling to one with a questionable background or minus a record of running a brand may leave you pause.
Sure, you could make a nice profit and move along to another business venture. That said don’t you want all you’ve worked on to fall into the right hands and be taken to the next level?
Finally, you should know better than anyone when you are ready to take on a new challenge.
If now seems like that time and you have one or more ideas, acting on it makes sense.
As long as you will have work and a steady stream of income, selling your SaaS now may be the best thing possible for you.