You've Spent Years Building the Business. What Are You Actually Building Towards?

I've worked with a number of business owners who know they want to step back or sell one day, and a good many of them haven't yet worked out what they want the sale to leave them with. By the time we get to talking about it, they have often started exploring the mechanics. They've spoken to accountants, considered different structures, thought about valuation and funding, and may have several perfectly viable options in front of them, each carrying its own questions on tax, property, equity and succession. There is usually an impressive amount of careful thinking on the table, and what strikes me is how easily it can carry an owner further into the mechanics without anyone having answered the question everything else depends on, which is what they actually want the end to look like.

What I find much more useful is to move away from the options for a while and describe the finished picture. If you sell all or part of the business, would you like to walk away completely, or stay involved as a shareholder or Chair? How much of the value you've created do you want to take out, how much equity, if any, do you want to keep, who do you want running the business and how much should it still depend on you? Those are the answers any adviser needs in order to work backwards, and they turn a choice between structures into a much simpler question of which one gets you there most efficiently.

It is an easy trap to fall into. Your accountants, your bank and your other advisers will each answer competently within their own remit, which means nobody in the chain is responsible for asking what you want it all to add up to. So you do the sensible thing and pick the best of the options in front of you, and a few months on you can compare two routes in impressive detail without having chosen where either of them should end.

Noam Wasserman's research on founders, published in Harvard Business Review, found that wanting to be wealthy and wanting to stay in charge are largely incompatible, and that founders who never decide which matters more to them can end up with neither. His work looked at how founders share equity as they build, but the same tension turns up at the other end of the journey, in how much control you keep, how much value you take out and how quickly. Those trade offs are personal, which is why no adviser can settle them on your behalf.

McKinsey's report on the coming wave of ownership transitions is American, but the pattern it describes will be familiar to anyone who runs a business here. It cites Exit Planning Institute research finding that fewer than one in three small business owners have a documented exit plan, and a 2025 Gallup survey in which 27 per cent of employer firms with owners aged 55 or over were either unsure of their long term plan or intended to close permanently. It also names emotional attachment and fear of losing a legacy among the reasons owners delay, and it is easy to see why, because planning an ending can feel like admitting you want to leave.

The last of those questions, how much the business should still depend on you, deserves more attention than it usually gets. The same McKinsey report describes new owners inheriting what it calls key person risk in businesses that have long relied on one founder, with sellers stepping away quickly and taking undocumented knowledge with them. If you are still the one who gets pulled back to the office for a customer on a Sunday evening, which is the story behind It Was Only An Hour, or the one who finds a proper break hard to take, which I explored in the case for taking more time off, then you already have a fair idea how much of the business lives in your head. It is far better to find that out years before anyone else does.

If you enjoyed the pre-mortem approach I described in July, you will recognise the move, because it also starts from a future that hasn't happened yet and reasons back from there. Where more than one person owns the business, it is worth checking that everyone is describing the same finish line, since co-owners can hold quite different pictures of it without realising, which I touched on in When Co-Founders Stop Pulling in the Same Direction.

You can start without knowing the answer to every one of these questions, provided you ask them out loud, with someone who has no stake in what you say, because the structure, the tax and the funding all become easier once the picture is clear and much harder while it is not. If you'd like to think it through with an executive coach who helps owners get clear on what they want before the technical advisers work out how to deliver it, that is what my 1:1 coaching is for, and you'll find more in this vein on my blog.

If it all goes exactly as you want it to, what does your business look like without you at the centre of it?

Nicola Gunstone is an executive coach working with CEOs and MDs of growing businesses. If this struck a chord, you can connect with her and follow the conversation on Nicola Gunstone, PCC | LinkedIn.