this post was submitted on 25 Nov 2023
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A smart man once told me that when someone offers a life changing amount of money for something you've built, take it. It's a rare opportunity and you'll still have plenty time left to build something new once more.
Love this! You can always build another business with a fresh new mindset.
Wise words. It’s definitely a rare opportunity. Starting a business is so hard, I don’t see myself building another in future
yes but you might start another of the same kind of company. Unless you have an enforceable non-compete, you can take all you learned and do it again. Same business, just smarter. It will be much easier the 2nd time you do it and then maybe you can sell that one too in a few years…..
Take the money, keep 5% and consult to other companies on what/how you did what you did. You’ll eventually be offered by another founder to either start a new company together. When you’ve had a break and you’re less burned out, it’ll be attractive again to start a new company.
You can also buy into the business you consult to, buying 5-10% of say 5 companies. Be on the board and consult to them for 1 day per month (paid role). So you work 1 week per month, basically and still earn.
If they won’t let you keep 5% equity of your original company, increase you price by 25% to fully sell. If you have 3 companies interested, 1 will accept it. If none do, keep the company and see it as a sign to take it to the next level.
life is long, depending on your age, you may find yourself with a change of mind after a few years. If you're hoping to settle down after this deal, you might be better off trying to raise company value to 2-3M which is possible to live off of long term with dividend investing and a stable portfolio.
900k pounds is a lot though. You can get by with much less in Europe. I would say this is already equivalent to 1.8M USD in terms of lifestyle.
It depends a lot of where you live, both in the UK and the US. And of course your lifestyle.
exactly, £900k in the UK sounds like alot but it really isnt, interest alone on it would be sub £30k once you factor in capital gains etc.
That’s the median household income in the UK as of 2020, which is about half of what it is in the US, which is where I came up with my ratio.
Taxes , taxes, taxes
It's not a lot in the UK if you want to live in London. A nice 1-bed apartment could cost £500-600k. At age 31, that doesn't leave enough left over for a comfortable life.
Even buying a cheaper place somewhere doesn't leave enough left over at such ayoung age. It's more than the vast majority have but it's not enough to retire on.
Sure. OP never said anything about retirement. It’s definitely a substantial amount though.
Yes, it's certainly a nice amount.
Buy a house for £200k, left with £700k with 4% withdrawal rate is £28k a year with no mortgage seems pretty good to me.
The 4% rule has never been tested over such a long period of time. It's also based on past results.
But it's not bad. But 200k on a house in the UK will get a below-average house. If that works for you, that's fine. It won't work for most people. £28k ayear in the UK would be pretty grim.
But you could do the above and get a job, so that woukd be a much better life.
But if living in London, it's not even enough for a nice homein a nice area.
In the future you might want to buy and existing profitable business with good cash. It's way easier than starting from scratch
Is less than a million really life changing though?
Take the money and work a job that you want Maybe get a managerial role. Or work at a VC. Or work at a school to guide students in building start ups
Take the money, down size your life, move to costa rica and enjoy your life and travel.
Sell it for sure!!!
You say that now because of your circumstances, but let’s say you got the money and a few months have passed after you sold. I am almost 100% sure that something else will come to mind. Maybe in a few months or maybe in a year, the point is that the mind continues to work in the background and that’s the beauty of it.
I have personally not sold a business but I was close to a person who did. It was his and his family’s work for more that 10 years. He was saying the exact same thing while considering multiple offers. He exited, got a lot of money, took time to rest and reflect and two years later he came up with a brilliant idea that now is in series B investment.
Take the money, time is the most expensive thing in this world and you have the opportunity to buy yourself more than enough time to think of something else
thats why they buy it instead of building one
Take the money. Move on and enjoy your life while you are still young.
Don't attach yourself emotionally to the vehicle you built. It's a tool to make money. If the money is good, sell the tool.
I told myself the same thing. I’ll just develop another licensed childcare centre! No big deal! Yes, it’s a big deal. I built and sold twice. Life is much different now. That’s the last thing I’d do. I miss my old business. My baby. So well thought out and organized.
I was a sub contractor at 29 had a few guys working for me at that time. my wife was pregnant at the time as well, Got burned for a big sum of money( big for me at that stage) had to pay everyone out almost lost my house truck you name it. 4 years later I'm thinking of giving it a go again. Never say never lolol
What about a non-compete agreement? Can’t rebuild the same business then.
To add to that, imagine you’re on your deathbed looking back. What would you tell your younger self to do?
I’d argue though, 1m isn’t truly life changing. It’s “buy a nicer house and maybe don’t need to work for a few years”
It’s not really “never need to work again” money, and definitely not “live luxuriously” money.
By goodness this is so right. I had a multi million pound offer for my travel co in late 2019.....then we know what happened. My business ended up going under. Still not recovered from it now
100% agree. Did just this a few months ago. Sold the business and I now have both time and money while I decide what to do next.