052: EXIT Like A PRO With These 3 Essential Tips

What happens when you sell the business you've built from the ground up? More importantly, who will take care of the clients who’ve trusted you for years?

These questions lie at the heart of a powerful conversation about the human side of business exits. While most discussions around mergers and acquisitions focus on valuation multiples and deal structures, this one dives into the relationship dynamics that truly define success.

When fielding acquisition calls, savvy business owners flip the script. Yes, potential buyers are evaluating your business—but you should be interviewing them just as thoroughly. Will they maintain your service standards? Will your clients enjoy working with them? The sale becomes less about walking away and more about ensuring continuity for those who helped build your success.

Most sellers focus solely on the financial payday, but this narrow lens overlooks the bigger picture. Your business isn’t just an asset—it’s a living entity with stakeholders who rely on it. The real shift happens when you begin seeing yourself not just as the owner, but as a shareholder. This mindset change can transform your approach, helping you extract value while preserving what you’ve built.

For small business owners whose net worth is largely tied to their company, exit planning is critical. Working with financial advisors, attorneys, and accountants on a regular basis opens up options beyond simply “staying in the seat until you pass.” There are multiple ways to secure your future while ensuring the business thrives without you.

Ready to think differently about your future? Start by viewing yourself as a shareholder in your own enterprise—and begin planning for the day your business continues its journey, with or without you at the helm.

Williams Logistics:
https://waionline.com/transport-usa

Micheal McKeen on LinkedIn:
https://www.linkedin.com/in/michealmckeen

Chapters

• 0:00 Finding the Right Buyer Fit
• 3:22 Selling Motivations Beyond the Payday
• 7:13 Milestones Leading to Exit Planning
• 11:10 The Shareholder Revelation
• 14:11 Planning Your Business Exit Strategy
• 16:08 Promotional Message

Transcript

Speaker 1: 0:00

At the end of the day.

Speaker 2: 0:00

ultimately, we need to be looking at who's the right fit for us, and so part of that conversation is is this a person that I would want to work with? Is this person that's on the other side of the line going to provide the same service that we're providing our customers now, so their customer experience doesn't change?

Speaker 1: 0:22

So, when you talked about how you took these calls and you learned something from every one of those, right, what are some of the things you were learning along the way by taking those calls?

Speaker 2: 0:35

A lot of you know it's really about business negotiation, or what are the people that are buying a company looking for? Are we a good fit In the MSP space? A lot of conversation around target client profile, because a lot of times when we start MSP businesses frankly, any business we take whatever opportunities come to us because the dollars are important and we that's how we tend to build our business, and it's not just IT businesses right, it's freight brokerages and financial planners and whatever else. We just take the money that comes to us because we want some sort of income right. But the end of the day, ultimately we need to be looking at who's the right fit for us, and so part of that conversation is is this a person that I would want to work with? Is this person that's on the other side of the line going to provide the same service that we're providing our customers now? So their customer experience doesn't change. What are they looking for from a documentation perspective? What are they seeing in my business? That's a detriment that they wouldn't want to buy it.

Speaker 2: 1:53

There's a lot of talk about contracted revenue versus time and materials revenue when it comes to M&A in the MSP space, and the reality is both of those businesses are saleable, but you know if, if they are a hundred percent time of materials and I was almost a hundred percent recurring revenue, that's not a good fit for the the customer. Right, these are two different models, two different directions, and so the customers are going to get a different experience after the sale. So more it was going to get a different experience after the sale. So Mario was really trying to figure out what are the questions they're asking. Do I like this person? Because if I don't like them, how do I expect any of my clients to like them either? Right, so it's really just trying to flip the script on them.

Speaker 1: 2:38

They're asking questions about my business, but I'm actually interviewing them to make sure that they're a fit for my clients definitely so, in a sense, in just like that, we're talking about the relationship aspect, right, providing, continue to provide, this service, that that you have built, and, um, in a sense, kind of like dating, right, you're going back and seeing, going, hey, is this a good fit, right, even though chances are, whether you stay on after the sale or you immediately exit, or a period of time and then exit, you know, um is a good fit for your, for your client base, and is it a good fit for your organization and the culture and those things? Right, and what? How does it align?

Speaker 2: 3:19

That makes a huge difference.

Speaker 2: 3:21

A lot of times when people are selling, they're selling for the purposes of getting out of work. The thought in a lot of cases is retirement or it's how do I free up these dollars? Because I want to go do something else. But I think ultimately a lot of businesses, when they're selling, it's just a I'm looking for the payday. They're selling it's just a I'm looking for the payday and given, uh, where I'm at in life? Uh, at the time that I sold, I still had kids in school, in in primary school, right. So I I wasn't at a place where I was like, oh, I'm ready to throw in the towel and just go goof off, right I sail the world yeah, exactly, uh.

Speaker 2: 4:05

So we and we don't think about those things of you know what the sell is right, because it's just I'm trying to get these dollars. I think that that's the average conversation or the average sale that happens I'm just trying to get the dollars. So there's not that many people that sell and stay on with that business and the time that they stay on if they stay on tends to be pretty short In a lot of cases. Excuse me, less than 30 days, less than 90 days. I stayed on for 14 months and when I was talking to another friend who was in the industry that has regular M&A types of conversations, he was amazed like wow, nobody stays on that long.

Speaker 2: 4:48

And don't get me wrong, some people specifically sell because they're tired of being that leader and they just want to stop making those decisions. Right, like I was a great technician, I used to do server projects that I love. I want to get doing that again and not have to deal with P&L or whining employees or whatever that problem is. So there are a number of businesses that when I sell, the intention is give me a job that I have less responsibility and we'll keep moving forward together. But those are, I think are few and far between. So it's's like we need to figure out the what is the path? And um, you know really, what is that motivation?

Speaker 1: 5:31

Yeah, so when you went I guess when you got into business um and the business that you've sold, when you started, that um was M&A a topic that was discussed in the very beginning you sort of say, like, what does this look like down the road for us, you and your partner, and for the business? Or at what point did that really become a thought?

Speaker 2: 5:50

Yeah, I would say there's kind of two milestones, to answer your question directly. No, not at all. Right, you're so gung-ho about starting this new thing and going out on your own right the Oregon Trail. It's kind of like this is fun and exciting, so you're not thinking with the end in mind. And I would say the more business owners that I've talked to that's a very common theme, right, we just want to keep, we want to build something and we want to have an impact, whatever that impact means. So we're not thinking with the end of mind. Don't get me wrong. There's just as many of those uh, high d disc profile people that are like I need to sell this business for five million dollars and I need to do it by this age.

Speaker 2: 6:37

Right, so when they start, they've got a goal in mind yeah and those are the people I love meeting now, right, because they're very goal focused and they're trying to get somewhere. Sure, a sale at all, no, no, I said sure. We're two milestones though. Um, the first one was as you start to mature, um, you start realizing that this business is more than just me and my trunk, uh, fixing computers. You know what I mean. Um, now we've got an office, we've got employees those employees have children. Um, you got all of these things going. And then there's kind of a we probably need to make sure that, if I get hit by a bus today, that we've got things in place. So one of the milestones I would say is the buy-sell. Again, I had a business partner and we were just doing something good together, right. So, and we're not thinking of the breakup, we're not thinking of the divorce or whatever- You're too busy living in the moment.

Speaker 2: 7:42

Yeah, exactly, and it's fun and exciting, right? So you're just kind of out there doing it and and this. In this scenario, we just felt like we had to have something in place in case there was something broken, right? I think at that point I was starting to work myself. I was certainly doing the vast majority of the sales, but I was working myself more towards doing just sales. And he's a fabulous technician, right. So he spent a lot of time building up the service team. So good split between the two of us. But if something happened to me, what happens to the sales? Or if something happens to him, if you have ever been in technology, if you don't use it, you lose it. It's like working out If you don't use it, you lose it. So, yeah, so if I'm not doing these whatever server network projects on a regular basis, and five seconds later.

Speaker 2: 8:38

That technology has changed and it's not because I lost the skill set there's definitely some of that but it's also the technology changed. It's different.

Speaker 2: 8:49

It's different than what it was when you last touched it, right, I mean it's always evolving and changing Absolutely, so you've got to it's absolutely different in order to go forward with some sort of fix right. So that was one milestone is the buy sell of hey, we need to just put some things in place. And then the other was um, I was a part of a networking group, um, that was part of the chamber of commerce, and in the chamber of Commerce they have a thing called business owners roundtable, and so this particular chamber had two different business owner roundtables and the group that I was in we just met at a coffee shop and we, for several weeks, we were just meeting and it was just getting together and I was like this is dumb, we need to be doing something productive if we're going to be here. Right, like it was not just a social hour.

Speaker 2: 9:41

There's actually a goal yeah, part of that is I like being in front of business owners because those are my prospects, those are the people that I'm targeting when I'm trying to sell my it services. So I figure, just the more business owners that I meet and have a social connection with, it's easier to parlay into a business relationship. But I was just, it was just spinning wheels, right, we were just going there and, like you said, social hour. So we started becoming more formal, started talking about what our problems are in our business and solving some solutions. But again, that didn't really have a plan, it didn't really have a path, it didn't really have a destination. So, as a group, we hired a business coach and the business coach he had his challenges because we were completely different businesses. I was in it. We had a guy that was um commercial insurance. We had a gal that ran, um, I guess you'd call it a physical therapy office, um, in town, right, just completely different businesses.

Speaker 1: 10:50

All in business is different.

Speaker 2: 10:52

different obviously focus or a hundred percent focus, 100 so yeah, and so typically, when you think business coach, it's like business coach with mark, business coach with mike right, it's kind of a one-to-one and I'm tailoring my conversation to that business. And this guy had multiple businesses that were at different stages of growth, different types of problems. So one of the early exercises he had us do was create an accountability chart for our businesses and he's like, just throw names on it. I get it that you guys don't have hundreds of employees. So, regardless though, every business has these different roles. We got finance admin, we got HR, we've got service, we've got whatever else All these businesses have these same roles. Your name might be on all of the roles, but the bigger you get, you're going to have to figure out who to put into that seat.

Speaker 2: 11:50

One of the guys in the group, he does product design. When he brought his back, he drew a line up from the accountability chart and wrote shareholder and circled that, and that one line and circle blew my mind Right. It was like holy smokes, this thing is its own living breathing entity, right? Like early on when I was a kid, my dad was into technology, um, and so I was interested in it, and so he was also interested in stocks, and so I had intel stock when I was a kid. Um, right, and it didn't.

Speaker 2: 12:30

It didn't even dawn on me that I owned a piece of a business when I was a kid and now I'm a business owner. I own all of the business, but there's still this thing called shareholder that Intel is doing that, this private business, I'm not doing so. Just having that mentality of there's this thing above the accountability chart, above the org chart, called shareholder, that thing just kind of made me think differently about the business, and it really changed the conversations that adam and I had, you know. Shortly thereafter, um, him and I started meeting with a financial planner, an income attorney, attorney and our accountant. All five of us were in a meeting every single month looking at the finances of the business and how we can improve it.

Speaker 1: 13:23

Wow, that's impressive yeah.

Speaker 2: 13:27

I don't know about impressive, but it just Most small businesses, and I say small, right, we get first.

Speaker 1: 13:32

What category is a small business? And most everyone I know is in a small business, right. So if for most small businesses they're not meeting with that, let alone that regular, but with those type of three individuals on a monthly basis, most are lucky to talk to a CPA once a year when they talk about financial side of the business right For a loan, a planner and legal, and that's just you, just something you just don't hear at our size and all it took was that line up to shareholder to kind of start that snowball, to start thinking about it.

Speaker 2: 14:04

And the the income attorney. He gave us a book trying to remember the name. It's something about private equity. I'll come up with it. I'll come up with the name, I'll send it to you. But, um, that book is really talking to small business owners that that business is their baby.

Speaker 2: 14:26

Right, you have to do something with this business. At some point you can die in that seat and then it's a hundred percent somebody else's problem. But that's the only instance where you don't deal with it. Every other instance you've got to do something. Right, it might be poor health, right, if I'm in poor health and I can't come to work, that business still needs to operate and the people that are getting w-2 wages from you still need to keep a roof over their head and still need to feed their kids. And a lot of these small business owners, they, their net worth, is tied up in this business. So at some point, if you're um, you can have this business until you die for sure. But at some point you have to realize that I need to get this money out of the business in order to be able to retire. So how am I going to go about doing that? Um and unfortunately it seems like a large percentage is I just stay in the seat and show up every day until I pass right, right and you know frequently.

Speaker 2: 15:41

Well, yeah, I think a lot of times it's because we don't know how to get the dollars out of the business, either while we're doing it or planning for when we're going to do it. And so that book really helped me realize that there are multiple paths to get your net worth to where it needs to be so that the business can live on without you. Your net worth to where it needs to be so that the business can live on without you.

Speaker 1: 16:02

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