Things To Consider When Selling Your IT Business

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Published: 25th November 2014
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So, you are considering selling your information technology business. It is wise to take your time and think it through thoroughly prior to acting, being 100% certain that this is the right time for such a move. After you've worked so hard getting your business to where it is today, you don't want to ruin it!

There really is no right or wrong reason to sell a business. Each person has their own reason: maybe your web reseller hosting business isn't making the profits you are used to, or maybe it's growing out of control and you just aren't prepared to handle the new volume; maybe you want to spend more time traveling or with friends and family; or maybe you are branching out and starting a new venture in the cloud hosting industry. Whatever the reason, these are the factors to consider before you sign those papers.

Look At The Market

The market as a whole is a great indicator as to whether or not you should sell. Within the technology market, it can be next to impossible to predict the future. No one can tell when the “next big thing” will come along to compete with your business, or when the market will hit saturation. If you see a noticeable upswing in sales or competition popping up left and right around you, it could be the right time.

Is your company doing well? If you are a startup, it might be smart to stick around for a bit to get the company up on its feet. If you are a top company within the hosting industry, you might want to stick around and enjoy the success. Of course, if you've been given an offer that you just can't turn down, feel free to take advantage of that.


Your business is growing at a good clip. Excellent! Calculate the projected share value for five years down the road based on your current growth. You will likely see that if you stick around for a bit longer, you can benefit financially when you sell in the future as your business will be worth more.

Personal Reasons

You probably know that this decision will impact every aspect of your life. And if this is your only asset, it makes it even more important!

Start by asking yourself why you are selling the business in the first place. How will the sale impact your financial security? Are you doing it just to ditch the responsibilities of owning a business, or are you doing it for the sake of the business itself?

Emotional Reasons

Will you be able to handle selling the business? Although you think you are prepared emotionally for the moment the business changes hands, you might be surprised at the way you actually feel when interviewing prospective buyers. Since you made the business the success it is today, you have a special attachment to it.

Are you ready to have days without meetings, paperwork, and phone calls? After you've spent all that time building the business, are you ready to sit at home with nothing to do? If the answer is no, would you return on a consulting basis? If you do plan to help out with things after the sale is final, be prepared: you no longer run the show. You are going to have a boss to report to. If you plan on staying home as if you are retired, you'll want to plan what you will do with your time.

Finally, how does your family feel about your decision?

Ready To Sell!

If you have thought it through completely and have decided selling is a wise idea, there is more work to be done. Start by getting a professional to appraise your business. It's hard to assess an IT business on your own, so do it to make sure you get a fair price.

Spend some time going over employee and contractor agreements for ownership of intellectual property information. The buyer would hate to be surprised with a lawsuit from one of your contractors after the sale is finalized. Their own due diligence will find this information out anyway, but if you disclose the information yourself, it will be appreciated (and less time consuming of a process!)

As I've mentioned, the IT world is tough in terms of selling a business. You just don't know when something will be introduced that makes your product or service obsolete. Contact a professional to talk to and think through each and every decision you make to assure you don't lose any money in the final sale, especially since you've invested so very much into the business over your lifetime!

Harriette Halepis
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