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How M&A Advisors Help the Transition After Selling Your Business

How M&A Advisors Help the Transition After Selling Your Business

Selling your business isn’t a decision to be made lightly or quickly. You may already know that M&A advisors can help you value your business and identify buyers. What you may not know is the role they can fill after the sale.

 Every business sale includes a transition period that happens after the sale is final. It may require the owner of the company that was sold to stay on with the new company in an advisory role.

At NorthStar Venture Partners, we work with business owners before and after selling their companies. Here’s what you need to know about M&A advisors and post-sale transitions.

Structuring the Transition

Before you sign on the dotted line and sell your business, your M&A advisor should help you review the paperwork and terms of sale. Whether you are negotiating an outright acquisition or a merger, the paperwork should spell out the terms of the transition.

Common transitional concerns include:

  • Details about your ongoing role as the owner of the company. Will you remain on board in a leadership position? Take a limited advisory role? It should be clear what you’re expected to do and what you’ll be paid before you sell your company.
  • Details about what will happen to your employees after the sale of your company. Will they stay on as employees? Be given severance packages? Train for new roles? You’ll need to specify the details.
  • Details about your clients or customers. For example, sometimes an existing client might be grandfathered in for a product that won’t be offered to new clients.

 Your M&A advisory firm should listen to your concerns and help you spell out the specifics in your contract.

 Monitoring the Transition

 Just as your M&A firm should play a key role in structuring your transition to make sure that you, your employees, and your clients are protected, they can also play an ongoing role in ensuring that the transition goes according to plan.

 Even when you know what to expect, the time after the sale of your business can be stressful and uncertain. There may be unanticipated challenges that arise as the reality of the sale sinks in.

It may be helpful to have an M&A advisor in your corner to help you navigate the realities of the transition and ensure that things are being handled properly.

Adapting to New Realities

 No matter now carefully you plan your post-sale transition, the likelihood is high that unexpected things will happen that will require agility from everybody involved. It’s the nature of mergers and acquisitions.

Your M&A advisor can help you address issues and problems as they arrive. They may also be in a position to negotiate with the buyers if things aren’t going according to plan. They can come at the situation with more neutrality than you can as the seller.

For example, you may find that some of the employees who stayed on aren’t happy or feel that their needs aren’t being met. They may approach you for help – and if they do, it may be easier to ask your M&A advisor to step in than it would be to attempt to address the issues on your own.

Advising You on Next Steps

Whether you are staying on as an employee or advisor after the sale of your company or not, you may have questions and concerns about your next steps. Some common concerns of start-up owners include:

  • How to protect their money
  • How to handle post-sale taxes
  • Whether to start a new venture right away
  • How to structure your new venture

Whatever your questions are, an experienced M&A advisor can help you. Ideally, you want someone who has been on the seller’s side of the table. A lot of M&A advisory firms are run by people who understand only the buyer’s side. They may not have the ability to advise you on what to do after you sell your company.

At NorthStar Venture Partners, we understand what it’s like to navigate a transition because we’ve been on both sides of sales. We draw on our vast knowledge of mergers and acquisitions to advise our clients through the transition period and beyond, to ensure they have the support and guidance they need to succeed.

Conclusion

Selling your company can be stressful and having someone experienced to guide you through the process is a must. Just as important is having an M&A advisor who can advise you through the transition period after selling your business.

Are you considering selling your business? Click here to schedule an appointment and work with NorthStar Venture Partners.

Julien Meyer

Written by Julien Meyer

NorthStar Venture Partners is led by Julien Meyer, MBA. A veteran of the tech community, Meyer is a 3x startup founder with 2 exits, a published author, a Harvard Business School Leading with Finance Alum and a Top Rated Startup Consultant (UpWork, 2018). Meyer advised on over 50 successful transactions before starting NorthStar. His experience has helped him understand the unique challenges that founders experience when trying to exit their ventures.