By: Patrick Ungashick
We believe business owners deserve to exit happily. After all, what is the purpose of working as hard as you do if you never manage to reach your business and personal goals at exit?
Exit impacts nearly every area of a business owner’s life. Failing to exit happily one day could ruin a lifetime of dedicated work and sacrifice. Therefore, it helps to know the most common reasons why owners fall short of exit happiness.
Let’s call these the Happiness Killers, and these are the 13 Happiness Killers you should know about.
- Failing to reach financial freedom. It’s not enough to exit the company and sell for a good price or maximize value. The more important question is, are you financially free after exit? If you exit but come up short of financial freedom, you may find yourself regretting having exited at all.
- Getting too little cash at closing. It’s natural to fixate on the total price you expect to receive when selling the company. However, just as important as total price is how much cash you get at closing. Any dollars that you do not receive at closing are dollars you might never see. If you never receive those dollars, you could end up exiting unhappily.
- Working with (or for) people you don’t like or respect. Many owners keep working after exit with (or for) the company’s new owners/leaders. If you later learn that you do not like or respect these people, you may find yourself deeply unhappy. This is especially true if you did not reach financial freedom (see #1) and therefore cannot afford to just walk away from the situation.
- Doing something that you don’t love. It does not matter how much money you have in the bank if you wake up every day facing doing something that you do not enjoy. As with the previous Happiness Killer, this can undermine your personal happiness regardless of how financially successful your exit may be.
- Not knowing what you are going to do in life after exit. After exit, most owners search for something to do that provides the stimulating challenges and sense of identity that they enjoyed from running their companies. If you never find this, you may struggle to be happy after exit.
- Feeling like your top people were mistreated. Your business’s value is undoubtedly rooted in its people. You likely will not be happy if your exit causes your people to unfairly lose their jobs or if it strands former employees in an inferior work environment.
- Feeling like your customers are getting less value. An exit that significantly diminishes the quality of goods or services you had been providing customers is not a happy exit.
- The exit breaks up relations between business partners. If you have business partners, you will probably care deeply about how they fare during your exit – and theirs. There are many ways that one partner’s exit can undermine another partner’s goals or plans. Partners who lack alignment regarding these issues often end up exiting unhappily.
- Leaving before you wish to. Leaving your company before you want or intend is a Happiness Killer. You will likely feel as though somebody ripped your company away from you.
- Sticking around longer than you want to. The opposite side of this issue is having to stay with the company any longer than you prefer after your exit. If you have other things you’d rather do and pursue, then being forced to stick around with the company will not be a happy exit.
- Exit causing stress at home/in marriage. Exit brings massive change in an owner’s personal life and relationships, especially with your spouse or significant other. Many couples are caught off guard and find themselves disoriented in the post-exit world. Left unchecked, this can lead to regret and unhappiness.
- Not leaving the company in good hands. If you exit the business only to realize later that the company’s new leaders are not competent to run the company and/or not equally committed to its success as you were, you may find yourself unhappy long after your exit.
- Paying more taxes than you could have. Your exit will probably be the most expensive transaction in your life, with taxes comprising the largest line item costs in most situations. An excessive tax bill can undermine not only your nest egg but also your sense of fairness and satisfaction.
With so many exit Happiness Killers out there, it’s prudent and wise to evaluate which of these potential threats you have adequately addressed and which may still be in your future. Ask us how to do this. You are working too hard and have made too many sacrifices not to be sure that you are on the path to future exit happiness.
