Selling your company? Start planning three years earlier
The biggest tax and timing decisions in a business sale happen long before the letter of intent. Here’s the founder’s checklist.
Ardent Editorial Team
Most founders spend years building a company and weeks planning what happens to the money. The order should be reversed.
Three years out
- Get a realistic valuation and understand what drives it
- Review your entity structure; some changes take years to pay off
- Consider gifting shares to family trusts while values are lower
One year out
- Model after-tax proceeds under different deal structures
- Clean up personal and business finances that are mixed together
- Decide what “enough” means for you and your family
The deal is a single day. The plan for the money has to last the rest of your life.
After the sale
Resist the urge to do something big right away. Park the proceeds safely, take a few months, and then invest according to a written plan.
This article is general education, not personal advice. Talk to a qualified advisor about your situation.