I’m working with an agency owner to think through his exit strategy. He’s 52 years old and doesn’t want to retire for at least 15 years. You may think he’s crazy to be planning that far out but the crazy ones are actually the ones who wait too long. Because he’s ahead of the curve, he has the luxury of exploring all the options and laying the groundwork to keep those options open as his agency evolves and grows.
I’ve seen so many agency owners who get close to their retirement age only to discover that they haven’t set up their business to be able to deliver what they would ideally like. The owner I’m working with now wants to sell his agency to an employee or group of employees. But there’s no one in his shop today that would be an ideal buyer. So we have to recruit/hire and train his eventual buyer. That doesn’t happen in a year or two. It’s definitely a long term strategy but because he’s starting so young, there’s no reason we can’t make it happen.
We started our work by asking/answering some key questions. You might run yourself through these to see how many of them you can definitively answer.
- Do you want to sell the agency or is it your intention to use the agency as an ATM machine making as much money as possible each year, and grow your wealth outside the business?
- Do you want to completely exit the agency and be 100% retired (or doing something else)?
- If you want to retain some ownership — what would your involvement look like once you take on other owners?
- Do you want to build your agency to sell to outside buyers or to employees/family?
- How sellable is your agency today (quite a few criteria to consider) and what would it take to make it more attractive to a buyer?
- If you do retire/step away from the day to day — what are you going to do that will be as intoxicating and engaging as running your business?
There are many sub-questions to each of these questions. But it’s a good start so you can begin to think about your long-range plans. Nothing is set in stone — you can always change your mind. But there’s a reason why most agencies aren’t good candidates for a sale. Know what you want to create and why. Then, give yourself time to make it happen. There’s no right answer to this question. But there is most definitely a right answer for you.
Do you know what it is?