WOULD YOU STILL WANT THE BUSINESS IF NOBODY KNEW YOU OWNED IT?
I’ve been thinking about a question this week that I think both buyers and sellers should ask themselves.
Would you still want the business if nobody knew you owned it?
For a buyer, imagine you could buy the business, but you could never tell anyone you’d bought it.
No announcement. No new title. Nobody in your industry knows. Your friends don’t know.
When someone asks what you do, you can’t tell them you own the company.
Do you still want to buy it?
And for a seller, turn the question around.
If nobody else knew you owned the business, would you still be as reluctant to sell it?
I think there’s something interesting in that question because ownership and identity become intertwined over time.
But I’m not sure all identity is the same.
There’s the identity we have because of how we see ourselves.
And then there’s the identity we have because of how we think other people see us.
I suspect most of us would like to believe our decisions are driven by the first one.
I’m not convinced they always are.
If you’ve owned a successful business for 20 years, being the owner becomes part of your place in the world.
People ask you about the business. Your staff know you as the owner. Your customers know you as the owner. Your friends introduce you that way. Your family probably talks about you that way.
At some point it becomes difficult to work out where the business finishes and you start.
That matters when it comes time to sell.
I’ve seen owners who genuinely want to sell their business, and have perfectly good reasons for doing so, become surprisingly uncomfortable when a real transaction gets close.
We tend to assume that means they’re having second thoughts about the price or the deal.
Sometimes they probably are.
But I wonder how often they’re actually having second thoughts about what happens to their identity once they’re no longer the owner.
And there’s another layer to that.
Are you worried about how you’ll see yourself?
Or are you worried about how everyone else will see you?
They’re not the same thing.
One is internal.
The other is status.
And I think understanding which one you’re dealing with is pretty important before you decide that the answer is simply not to sell.
Buyers can fall into the same trap from the opposite direction.
There are businesses people want to buy because they’re good businesses.
And there are businesses people want to buy because they like the person they imagine they’ll become once they own them.
That distinction is probably harder to recognise in yourself than it sounds.
You can convince yourself you love the opportunity when part of what you really love is what the acquisition says about you.
That you’re now an entrepreneur.
That you run a company of a certain size.
That you’ve moved from adviser to owner, employee to employer, or investor to operator.
Again, none of those things are necessarily bad motivations.
But I think you should know when they’re influencing the decision.
Because buying a business to reinforce an identity is very different from buying a business because you genuinely want what the business itself offers you.
Which brings me to a little test I’ve been playing around with.
Imagine you’re at a party and someone asks what you do.
Complete these three sentences.
“I own…” or “I am about to own…”
“I do…” or “I am about to do…”
“I create…” or “I am about to create…”
Then ask yourself which answer you’re proudest of.
Feel free to email me your answer. I read every email.
But I think that’s a much harder question than it first appears.
“I own” is about possession, but it can also be about status.
“I do” is closer to how you actually see yourself.
And “I create” might tell you something about what you actually value and the purpose of the business in its ecosystem and community.
There’s no right answer.
What’s interesting is which one you instinctively want other people to know.
For a seller, perhaps the question is whether selling the business actually changes who you are, or whether it only changes the way you’re able to describe yourself to other people.
For a buyer, perhaps it’s whether you want the business itself, or whether you want the identity you think comes with owning it.
I think both are worth understanding before there’s a contract sitting in front of you.
Because we spend an enormous amount of time examining the financial motivations behind transactions.
We ask why someone is selling.
We ask why someone wants to buy.
We talk about retirement, growth, returns, succession and opportunity.
But some of the strongest motivations in a transaction probably never appear in an Information Memorandum or a financial model.
They’re tied up in how people see themselves.
And perhaps even more importantly, how they want to be seen.
So if you’re thinking about buying or selling a business, try the question.
Would you make the same decision if nobody else ever knew you owned it?
I think the answer might tell you something that the numbers won’t.
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