Selling a Business

3 Signs It's a Smart Time to Sell Your Online Business

Running a company takes one set of skills. Fully capitalizing on beckoning opportunities requires another -- and an awareness of your market.
3 Signs It's a Smart Time to Sell Your Online Business
Image credit: Shannon Fagan | Getty Images
Guest Writer
Founder of 501 Words
4 min read
Opinions expressed by Entrepreneur contributors are their own.

If you run an online business, you’ve probably checked out several articles on why or how to sell your online business. But all too often, the available information creates a feeling of doom and gloom. After all, 90 percent of all startups fail -- with or without any exit opportunity whatsoever.

Even overlooking that grim truth, there's no shortage of bad exit stories for dot-com brands. (Even Jeff Bezos failed with Diapers.com.) These aren't good omens for online entrepreneurs, but not all exit plans need be triggered by negative outcomes.

When I wrote about how to protect startups from merger-and-acquisition predators, some feedback from prominent founders expressed small-business owners' genuine desire to sell their brands. It’s not always the big sharks circling little fish -- many founders are looking for an exit, too. 

Related: 10 Questions to Ask Before Selling Your Business

Here are three positive signs every founder should watch for. Each is either a fairly implicit or a clearly explicit indicator that you'll get the most out of your investments and can use the upcoming sale to move quickly to the next level.

1. Your business has outgrown your capacity.

Investors are fascinated by thriving startups. It shouldn't come as a surprise that booming growth and impeccable market value also will attract potential buyers. This enviable position means your business isn't battling any negative situation such as poor performance or financial downturn. Successful founders often discover they can't keep the wheels churning forward all on their own.

Imagine your business has grown to the point that you must establish a micro workforce of marketers, content strategists, social media managers and the like. But the stress of dealing with employees makes the next move a nonstarter. The sign is positive and clear enough: Sell the business at the highest possible value.

Related: Time to Sell Your Business? You'll Need Metrics.

2. There’s high profit at stake.

Achieving success as a CEO garners prestige, but not all founders want to carry the title for decades -- at least not for one brand. Some cite the volatile nature of business. Meanwhile, scores of successful entrepreneurs look for exit mainly because they want to explore other opportunities. Whatever the case, profit is an essential factor.

If your business goal is short term, you already know you have to stay alert. Any founder who’s looking to maximize profit through exit shouldn’t ignore any juicy offer whenever it comes along. Positive signs and prime times don’t stay around for long. Not at all.

Your online business might not be a billion-dollar company. But a multimillion-dollar one, as humorously put by Brian Hamilton of Sageworks, might be worth considering as a payout. Abdullahi Muhammed, CEO of oxygenmat, toed this line when he grabbed the offer to acquire his former niche site, howtostartablog.net. The young online entrepreneur went home with $280,000 courtesy of a successful exit.

Related: Know When and How to Sell Your Business

3. You’re set for a new venture.

If you've decided to dive into a new venture, it might be time to close the chapter on your current business. The Young Entrepreneur Council cautions owners against trying to do it all: “The mistake some entrepreneurs make is to think they can manage a new opportunity in addition to their existing business, but what can happen is that both businesses suffer.”

Juggling multiple tasks easily can lead to burnout for you and meltdown for your business. Instead, consider bowing out from your business to focus on your new challenge. If you handle your exit well, you'll have the chance to make an amazing profit in the process. 

Related: Expert Advice to Help You Prepare to Sell Your Business

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5 Important Questions to Ask Yourself Before You Sell Your Company