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When you get an acquisition offer, your employment contract can be a key element. Just ask Eric Sit. Sit’s company was acquired by Detection and six months later, Detection was acquired. Sit lived to regret the employment contract he signed.
When you get an acquisition offer for your business, it is natural to focus on the offer price, but your employment contract can be a key element of your remuneration.
I know, you don’t want to be an employee but, when you sell, you’ll likely have to sign on for a transition period or earn-out where you will officially be an employee again. The terms of this employment contract are a key element of any deal.
Just ask Eric Sit.
Sit’s company was acquired by Detection Technologies in 2013. Six months later, Detection was acquired and Sit lived to regret the employment contract he had signed.
When Sit sold CyberWAVE, he was offered shares in Detection rather than cash because 70% of CyberWAVE’s revenue was coming from one customer. Sit could have lobbied for more of his proceeds to be paid up front had he had less customer concentration, something we help you eliminate during module eight of The Value Builder System™. Curious to see how we work with business owners? Complete this form and we’ll have one of our local market Certified Value Builders™ get in touch.
Click to Tweet: Ep. 73 of Built To Sell Radio, The Second Most Important Thing to Negotiate When Selling Your Business.
At Built to Sell we’re all about shifting the balance of power from the buyer to the seller. If you support our mission, please write a review on iTunes—and if you have any comments or questions you can find us on Twitter and Facebook. Tune in every Wednesday for another episode of #BuiltToSell Radio with John Warrillow.