Christine Trumbull is a CPA and Quickbooks certified pro advisor and the founder of Pinnacle CFO Services. 28 years of experience in financial and business management have led her to her current role: ensuring seamless transitions for founders and their families.
A trusted resource for family-owned and closely held businesses looking to take their company to higher places.
Many advisors to business owners think a sale to key employees is a great option for companies that don’t reach the “sale to third party” threshold. Typically, they define this threshold as the point at which a business can be sold for (largely) cash. Depending on a variety of factors, this threshold is usually around $10 million. While this may cause some owners to consider a sale to key employees, it is not the reason that most of them want to sell to key employees. Over the years, we’ve found that owners choose to transfer their companies to key employees for different reasons, including these seven.
No matter which of these is your reason to want to sell your business to key employees, it is prudent to investigate your motives thoroughly. For example, if you believe that your business (at a favorable valuation) is simply not attractive to outside buyers, I urge you to talk that out, (you can do that with me here) to test your hypothesis.
When owners want to transfer their businesses to key employees, do they actually do so? If you have any questions about this type of transfer, contact us. We can discuss what’s going on, and can ask you the questions necessary to help you define your best exit path. Whenever you’re ready to fast track your business success, book a free call and let’s talk about you and your business. You can do that here: time with Christine.
The information contained in this article is general in nature and is not legal, tax or financial advice. For information regarding your particular situation, contact an attorney or a tax or financial professional. The information in this newsletter is provided with the understanding that it does not render legal, accounting, tax or financial advice. In specific cases, clients should consult their legal, accounting, tax or financial professional. This article is not intended to give advice or to represent our firm as being qualified to give advice in all areas of professional services. Exit Planning is a discipline that typically requires the collaboration of multiple professional advisors. To the extent that our firm does not have the expertise required on a particular matter, we will always work closely with you to help you gain access to the resources and professional advice
Any examples provided are hypothetical and for illustrative purposes only. Examples include fictitious names and do not represent any particular person or entity.