Should you sell your start-up?


 As a young (or not so young) entrepreneur, there are plenty of reasons to get involved in the UK’s burgeoning start-up scene. You might want freedom from the spectre of a boss imposing discipline on you from nine to five every day or simply the opportunity to indulge your passions and get your big ideas on the road. Your start-up of today could be the Facebook or Twitter of tomorrow.

One of the main attractions to owning a start-up is the chance to sell it once you’ve become successful so that you can cash in on a lump sum. Here are some of the other reasons why you might consider selling your start-up as well as some handy hints on how to go about the process.

Dedicating time for new projects

The windfall of cash that selling a lucrative startup can offer is appealing to many entrepreneurs. However, as the saying goes, time is money – and for that reason, selling your startup can also give you the chance to go about a new venture.

You may not have fully scratched the entrepreneurial bug and are desperate to follow through with another idea. Having a successful start-up on your CV is an excellent achievement, and you will likely find that the problems involved with your first venture, such as an inability to secure investment, are much less acute the second time around.

You might also have decided that you’d like to give back to your community after years of working for yourself. By selling your company and relieving yourself of day-to-day duties and the pressure to earn, you’ll be able to get involved in charity and voluntary work without needing or expecting any sort of reward. If you’re still seeking the satisfaction of management, then you could even fund your own third-sector organisation or take a job as a charity leader.

Exploring new resources

If you’re selling part of your startup (or all of it, but retaining a management function), then a parent company can bring a welcome influx of new resources. You could have a big idea for a new market segment or a plan for a new set of adverts or marketing tools, but you need the cash to do it. You may also wish to open a new funding stream to buy premises or equipment. Either way, selling a stake in your startup is ideal if you need cash straightaway.

Realise that new blood can be jarring

While selling your startup has many advantages, one of the problems that you might face is a decision by the new owners to change direction, branding or some other aspect altogether. Though you know that it’s for the best, it can be difficult to see a project that you’ve built from the ground up change so suddenly.

For these reasons, it’s a good idea to first consult someone whom you trust before you make the decision to sell. This could be a friend, family member or trusted mentor who has your best interests at heart. If you decide to go ahead with the sale, then you should keep at the forefront of your mind the fact that you are making the best choice for your start-up in the long term.

Remember that new investors or buyers not only bring their cash, but they also provide their expertise. As an entrepreneur, this can be just as valuable as an injection of money and can help you develop your skills and grow your network before you move on to your next project.

How to go about selling

There are plenty of companies that may consider taking a stake in your startup, such as investment companies like Quob Park Estate. Using online tools such as LinkedIn to find buyers is a good idea, and you can also find angel investors on sites such as AngelList. No matter what option you choose, it’s important to gel with those who will be taking a state in your company and work together to make sure that it is the right fit for both parties.

It’s clear that selling your startup can be a difficult decision. From a loss of power to the fear of taking a new direction, there are many risks to the entrepreneur. However, an instant injection of cash can not only turn your business around but also free up time for you as an individual, and this is why it’s a good idea to consider a startup sale as one of your options.

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