Owners want out of the restaurant industry, and investors want in.
If you want to sell your business, that’s fine. If you are in for the long-haul, great.
Either way, it’s critical to keep the bigger picture in mind. Here are my thoughts on that bigger picture.
There’s blood in the streets
Investors are looking for a deal, and, whether it feels like it or not, there are many interested in the restaurant industry. Here’s why:
It’s a proven industry: The industry survived the ’08-’09 crisis and now the COVID pandemic – it’s a stable industry that’s not going anywhere. Plus, people will always want to eat out.
There is pent-up demand: Customers are ready to go out to eat again, and with over 100k restaurants closed after the pandemic, there’s market share up for grabs.
There are good deals: Investors want a motivated buyer to create leverage in their favor. Negotiating with a burned-out owner who is desperate to get out of the industry is much easier than working with a passionate entrepreneur who sees a future in what they are doing.
A word of caution
As a restauranteur, you probably got in the business because you wanted out of the 9 to 5. You wanted to be your own boss. You wanted to build a business to one day sell and spend your time how you want.
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So, if you are considering a sale, I have a few words of caution:
Don’t give it away: Your business is worth something. Investors want to buy it for a reason; they see opportunity. Don’t let the last year fog your vision of next year.
Prepare for the sale: Don’t just sign up for the next capital raising event to find your knight in shining armor. Make your business attractive – tighten up processes, get your finances in order, and get the right people in the right seats. It’s much easier to say than do, but it will pay off in spades.
Don’t sell yourself, sell your business: If an investor offers to buy your business with the caveat that you have to stay and run it, then they didn’t want your business – they want you. Don’t sell yourself back into the job you worked so hard to leave behind.
Build to sell
Whether you are looking to sell or not, act like you are. The more attractive your business is to investors, the better it will be for you.
A hallmark of a saleable company is that it can run without you.
A hallmark of a happy you is that it can run without you.
You need the right tools, the right team, and the right insight to help you get there.
Don’t give up on the dream
I hear you – doing all this isn’t easy. I just don’t want you to sell yourself short.
If you made it through the pandemic, you are doing something right and built something worthwhile.
I am not telling you not to sell – I don’t know your situation.
What I am saying is to do so intelligently. Do it in a way that is best for you, your family, and your future.
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