I hear it frequently from folks who’ve sold their companies: “Just a few years ago I was somebody,” they say. “I owned a successful business. People took their orders from me. I was known in my community and respected in my industry.”
“Then I sold the business,” the story continues. “It was supposed to be a dream come true. Sure, I’m financially secure….” You know what comes next, but last week, I heard a new punchline:
But who am I today? Just some guy in line at Starbucks. No one knows me, no one cares what I think. Is this what it was all for?
“And do I want a latte or a cappuccino today? Decisions, decisions….”
Ouch. The fact is that, for many entrepreneurs, the transition to life after the sale can be challenging. After all, you spend decades, perhaps your entire adult life, building your business. Then, one day, you’ve sold the company and you’re starting all over.
According to a white paper written by the Columbia Business School, “While the sale of a company can mark a significant success for an entrepreneur, the reality of selling a venture often represents a loss of identity and community. Entrepreneurs may go through several stages of recognizing and coping with this loss, and this process can sometimes take years.”
BEYOND THE DOLLAR SIGNS
It doesn’t have to happen this way. But to be ready for this next step, you first need to know what actually makes people happy. And I’ll give you a hint: it’s not money.
Sure, everyone wants to be comfortable, and everyone wants stability and security, a few nice things. But studies repeatedly show that accruing more wealth (beyond basic necessities, of course) does not correlate to greater happiness.
What CAN make us happy?
- Having A Purpose: It might be changing the world, or it might be taking care of your kids or grand kids, but either way, you need a mission.
- Connecting With People: Meaningful relationships are essential. Humans are a social species. Relationships bring us joy, meaning and purpose.
- Having “Flow” Experiences Every Day: By “flow,” I mean the feeling we get when we’re “in the moment” and “in the zone.” Athletes talk about it a lot, but we all experience “flow” when we do something challenging that we’re really good at. Time flies, we’re at one with our actions. It’s a great feeling.
It’s quite likely that running your business used to meet a lot of those needs—people to connect with, a purpose to fulfill, and a feeling of “flow” every day. As the Columbia Business School study put it, “For many entrepreneurs who have invested a vast amount of financial and emotional capital in their business, the experience of selling and moving on may involve a loss of identity and purpose, despite the financial security that usually accompanies the sale.”
If you’ve sold your company, those opportunities might be gone for you. How will you find them?
This is why so many people start another business late in life or even try to buy back the business they sold. It did a lot more for them than simply pay the bills.
So How Can You Avoid Ending Up Feeling Last In Line? Think through the non-financial changes you’re in for at least as carefully as you deconstruct every line of the deal. What do you want your life to be about, and how can you make sure that happens? Start thinking about what’s next well before your morning is missing the things that previously brought you meaning.
SALES COME IN MANY SIZES
Plus: As they begin to think about selling their company, many business owners don’t realize that “selling” isn’t one-size-fits-all.
Investment bankers may not share this secret because it can make their jobs harder. But the reality is that there are various ways to ease off on your responsibilities and get some liquidity out of the business without selling it outright. It’s your company, after all. More importantly, it’s your life, and only you can decide what’s right for you and your family. Your lawyer and banker are there to make it happen for you.
And for those who’ve already sold their business and are feeling like all they are is the third person in line at Starbucks, remember: you’ve been here before. It just didn’t bother you then. So the problem isn’t being in line; it’s deciding what to do next and getting to it. And that’s a problem you can solve.
One Last Note:
You can also engage an outside third party (like my team at JOYN) to help you work through these questions so the deal pros don’t have to. It’s never too late to start a conversation, especially because there are ways to generate liquidity long before you start thinking of a sale. Learn about our Strategic Liquidity Services or RSVP for our September 15 lunch for Atlanta business owners.