While there are several factors to consider when planning an exit strategy, your employee and management team is one of the most important. Key personnel are an asset to your company, an asset that buyers will take into consideration when evaluating your company for purchase. Advance exit strategy preparation will allow you to highlight the strengths of your team for prospective buyers (a detailed management and employee checklist can be found in The Exit Strategy Handbook).
Items to consider when highlighting key personnel:
Resumes: Provide current resumes for key personnel. Resumes should include responsibilities and outcomes associated with the employee’s current role and the following: current compensation, bonus packages, employment contracts, buy-sell agreements, documentation of oral promises or contracts, and equity compensation. Depending on your objectives, you may also include your own resume and qualifications in the mix.
Retention: While you’re examining your team as a whole, this is a good time to evaluate if there are key personnel a new owner will depend on after a sale takes place. In this instance, you can plan ahead by locking in these employees through employment contracts with non-compete clauses (refer to a good labor attorney for advice in this area). Potential buyers will view this as a positive.
The performance of your management team is a good indicator of your company’s future success. By giving yourself ample time to plan an exit strategy, you give this critical aspect of your company’s worth its due attention. Do you need expert advice on how to sell your company? Contact me at 317-513-3016.