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When Should You Sell Your Small Business?

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My wife and I recently sold one of our websites – no not this one! Several months after I started blogging, my wife decided she wanted to try her hand at it to see what she was missing. I think she was afraid she had lost me to the world!

My wife was in the medical field before she became a stay at home mom, so she started a health and nutrition blog. After close to a year of blogging, my wife decided her blog had run its course and it was time for her to hang up her blogging hat. That left us with a website that had value and was earning money, but was otherwise stagnant.

Why we sold our website

My wife put a lot of heart into her website. She shared her personal story, she had a substantial number of subscribers, and her blog was starting to earn a profit. However, she was no longer interested in writing new content and decided to move on. Because her site shared her personal story, she didn’t want to sell it. So we left the site up and continued earning a minimum amount of income through advertising.

Her business started losing value. The best time to sell her site would have been when she stopped writing, or shortly afterward when traffic and income were at their peak. After she stopped writing new articles, traffic and income started slowing down considerably.

After almost a year of dormancy, I asked her again if she wanted to sell her site. She was more open to discussing it and we finally agreed that we would sell it if we could get a reasonable price. I also told her we could use the money to start a 529 college savings account for our daughter, an idea my wife liked.

So I contacted a few people and came to terms with a friend who purchased the site and is now creating new content. Because the blog was already an established site and domain, I am positive it will improve in terms of traffic and income in relatively little time. I can’t share the terms of the deal, but it was enough that we feel we received a fair price, and low enough that the buyer should be able to turn a profit.

Bottom line: We sold the website because it was an asset that had more potential than we were realizing and it would continue to diminish in value unless it was nurtured.

When should you sell your business?

Many small business owners will face this question at one point or another. Your business may grow too big for you to handle, you may no longer have the expertise or desire to run it, you may get an offer that sweeps you off your feet, or you may simply wish to move on. Quite simply, there are as many reasons to sell your small business as there are types of small businesses.

Some reasons you may consider selling your business:

  • Time. Running a small business takes a lot of time, and selling your business can give you more time for other pursuits.
  • Money. Cash out; sell it to someone with the capital to expand it; sell it to fund another venture; etc.
  • Life events. Death, divorce, birth, moving across the country, and a host of other personal reasons may tip your hand toward selling.
  • Decreased performance. Decreased sales and revenue could be a good reason to sell your business. Sometimes a change in ownership can breathe new life into a company.
  • Growth. A period of growth can be a good time to sell because it is more attractive to buyers. Growth may also make your business too much to keep up with.
  • Partner wants to move on. Sometimes one or more partners can buy the remaining interest in the company, other times the entire business needs to be sold.
  • Other opportunities.

There are no clear cut answers regarding the best time to sell your small business, and because each small business is unique, it isn’t possible to cover every example. Just make sure you do your research and make sure you are selling your business for the right reasons.

Have you sold a business? I’d love to hear about it.


Published or updated July 26, 2009.
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{ 10 comments… read them below or add one }

1 DDFD at Defensive-Entrepreneurship

Nice post! Most entrepreneurs neglect an important aspect of starting a small business– the exit strategy.

The exit strategy can even dictate how you run, build, and operate the business. Some businesses are run to be sold, others perpetuated, and still others to be shut down.

I am glad to hear you were able to salvage some of the value of the site.

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2 Ryan

DDFD, you’re right – many entrepreneurs never consider the exit strategy when they start a business.

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3 MoneyGrubbingLawyer

I sold a side business I had been running a few months back. My primary reason was that I just didn’t have the time to dedicate to it. The value was also at it’s peak, or at least as high as I could hope to bring it- holding on to it wouldn’t have done much to increase the value, and it could have started to decline without the attention required.

Even so, it was a tough move to make. I didn’t realize just how attached I was to my side hustle until I saw somebody else doing it. During the final few months it had been more of an annoyance than anything else, but when it was gone I actually missed it!

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4 Ryan

MGL, Congrats on the sale. Even though you missed working on it after you sold it, it seems like you made the best decision for yourself and the business.

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5 Journey

Good post. It is something to think about.

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6 Curious Cat Investing Blog

Good thoughts. Another factor is the personal value of owning it. I have several sites which I really don’t have any interest in selling. I want to own them. I want to use them for decades. If the value were to spike and decline, I don’t really care. Now if I could get enough money to retire with then I suppose I might sell (if some of the points you mention were also true), but since that is not going to happen I am not going to sell.

On the other hand I also own some sites I would sell f or the right price. But my style is more toward long term managing of site than building and selling them. But that is just how I think I work best, if I were wired differently I would have no problem building and selling sites.

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7 Ryan

Curious Cat, I agree – there are times when you shouldn’t sell. One shouldn’t sell a business asset with value just because they can make a buck from it. The same thing goes with items around the home. Some things should be kept because their meaning or personal value is more than their intrinsic value.

In this example, my wife and I had no plans to develop or continue the site. After discussing it, decided that we would consider it a victory if we could sell it for a profit and use the proceeds for our baby’s education fund.

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8 Kirk Kinder

I have yet to sell a business, but I work with many business owners. Often times, it seems that passion is the number one reason to sell. Once they lose the passion that prompted them to start the business. Or, I have seen several owners who left because they enjoy the creation of a business, not the management of an established company.

It sounds as is this is what your wife encountered. The fire just burned out so it was a wise move to sell.

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9 Ryan

Kirk, Passion certainly plays a role. Many entrepreneurs love the challenge of building something new, then once that is done, the goals change. There really is no right or wrong here – just whatever works best for you and your business.

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10 Mark Bennett

The ideal time to sell any business is when it is peaking financially. This rarely happens, because people cannot recognize they are peaking. Short of this, whenever you feel you are beginning to lose enthusiasm for the business, it is a good time to sell. Keep in mind that it should always appear that you are still enthusiastic and willing to keep the business if you want to get the best price.

I didn’t know you could make money with and sell a blog. Thanks.

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