Selling a Business

Stakeholders Involved In Selling a Business

Before selling a business, it's important to think through whom your key business stakeholders are and how they might react to selling the company.

Key stakeholders that are relevant to a business sale include co-owners, family members, investors and key employees.

These stakeholders can have a significant impact on selling a business. Their impact can range from giving you advice on whether now is the right time to sell a business to being an obstacle to progress and perhaps even preventing you from selling the business.


Needless to say, it's very difficult to sell a business without the consent of a co-owner. It's important for partners in a business to discuss exit plans years before they might actually want to sell. The question needs to be asked: "What if I want to sell out and you don't? How are we going to handle that?" By asking the tough questions in advance, agreements can be reached which make things easier when it's time to sell, whether it's a unanimous decision of all the co-owners or one partner simply wants out.

Family Members

There are some things you can say to family that you can't say to anybody else. Talk to your spouse about selling the company. Talk to your children, as well. Find out what their concerns are. Let them know what your concerns are. Iron out any conflicting desires and resolve any big issues. If you don't get the family involved, you might be in for an unpleasant surprise. Families that don't communicate well can find that selling a business can have a destructive impact on the family. We've seen it happen dozens of times, so be careful!


If you've raised money for your venture, you'll need to put yourself in the shoes of your investors. What price will you need to sell the business for to get a decent return? Is that business sale price achievable? Does it make you happy as well? The way you approach your investors about selling a company will vary based on many factors (e.g. are they minority investors or majority investors, etc.). To truly sell your business successfully, it's best if your interests and the interests of your investors are tightly aligned. In many cases, this is simply a matter of having a frank discussion between business owner and business investors.

Key Employees

Telling key employees about your desire to sell a business is tricky. Tell them too early, without a thoughtful plan regarding their role after the business sells, and they might get spooked and leave the company. Loss of key employees can jeopardize your ability to sell or curtail the price you can get for the business. Generally speaking, if you need to keep the employees, you need a plan that motivates them to stay. Ideally, the new owner will be willing to give them profit-sharing or equity. Unfortunately, you won't know the new owners intentions until the eleventh hour. For this reason, it's tough to have a conversation with key employees about selling the company. One solution that we've seen work effectively is to offer key employees a share of the proceeds from the company sale. In this way, they are highly motivated to work hard for the company, at least through the closing of the business sale. After that, it's up to the new owner to keep them on board, assuming they want to.

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