The Process Of Selling Your Business With Donna And Gary Thiel
In one way or another, everybody leaves their business. Prepare well for the inevitable by knowing your exit strategy. In this episode, Bob Roark talks with Donna and Gary Thiel, small service business owners who, after more than 30-plus years, has closed the sale of their business. They share their journey and offer great insights about the process, for when you also decide on selling your business. Follow along to learn about who to talk to and what to do during this important business decision.
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The Process Of Selling Your Business With Donna And Gary Thiel
We have Donna and Gary Thiel. Thank you for your time. This is going to be a little bit different episode. We're going to talk about the journey between deciding to sell your business and the process. First off, tell us a little bit about your business.
We own a small service business. Window cleaning was our main function. We did everything from residential to high rise. We also did snow removal services through the winter months.
How long had you run the business?
I originally bought it in fall 1986. I had worked for the company for about 6 or 7 years prior to that. Donna came in ‘96, ‘97-ish. She came in and helped with a lot of things like accounting stuff.
What was the date that you closed on the sale of your business?
March 1 of 2019.
You ran that for a long time, 30-plus years. There's that ongoing discussion that you hear from business owners. At some point, you're going to exit the business in one way or another. Everybody leaves their business I suppose. What was that thought process like when you started thinking about selling your business?
The stress level got high. The economy was good in Denver and stuff, but that brought along some difficulties of finding help and things like that. The salaries had gone way up in the city. It got difficult to compete and finding enough good people to get the work done to stay competitive was getting difficult.
I would imagine it's not the everyday person that wants to hang over the side of a high rise.
They are a different old breed. There are a lot of them out there. It’s some of the bigger companies and a lot of the construction industry was even taking employees that would normally be doing things in our industry. They had increased salaries much and benefits and it got difficult.
I think about the challenges when you're in a full-employment economy. You and Donna got together and made it a decision that it was time to sell the business. Once you had that decision in place, what were your next steps to try to identify how or who you are going to use to help you sell?
We were lucky because Marla is one of our accounts in my work in commercial packaging. I'm a broker. We automatically went to her and started asking questions. She comes involved with Keith and Keith was amazing.
Marla is a unique individual. She is the CEO of Raincatcher. You were fortunate you had a contact within the industry. You started working with Keith. For that process of going through, what was the process from when you started talking with Keith to when the business was effectively ready to go on the market? What was that like?
[bctt tweet="You got to wait until it's completely done and not get wound up." username=""]
There was some work involved. There were a lot of things they were asking for that we weren't expecting. We attempted to sell it ourselves. We're probably about 1.5 years before going out and seeking a broker in Raincatcher and such.
What was that like?
That got a bit frustrating. We had a couple of people that showed interest. We didn't know all the ins and outs of how to deal with them, and all the nuances and things or everyday knowledge to the people at Raincatcher. After dealing with a couple of buyers, they flaked out on us and things. We were frustrated, to say the least, but still looking down the road and wanting to get out of there. Donna said, “Let's get ahold of Marla and talk to them and see what they can do for us.”
The emotional roller coaster when you're working with buyers and the amount of information they want can be rather daunting. I think about that transition. You had already been through the decision process. You tried to market yourself. You started working with Keith and I'm presuming that the nature of the questions that he asked, you had been through around that track once before.
The questionnaire was extremely thorough. It made us think outside the box, which was great because he was able to help Keith put together a full story about King Kong. It took us probably a good week. We had to do a little bit of it, then come back to it. I type it up and they would come back for another couple of questions. It was pages long and it was very thorough, which we never even thought 90% of those questions, to be honest with you.
For most business owners, you're busy running your company, making payroll, finding help and dealing with this, that and the other. To put your hat on backward and start trying to look at your company from a buyer's eyes, that's a challenge. As you went through that questionnaire, were there a-ha moments when you were going through that process on the questionnaire?
There was like, “I can see that makes a lot of sense,” and things that didn't occur to us when we were doing it ourselves. I'm much more involved than, “Let's put an ad on Craigslist and try to sell your business.”
Gary, you'd already gone through in dealing with buying the business before. You'd already come through from a buyer's perspective when you bought the business.
It was a different situation.
He bought it from a family member, so it was behind the scene.
You had all your paperwork done. You'd been through all the process and so on. Once the paperwork was in and your business was listed, what was it like from that point going forward?
It was seamless. He would call us and tell us he has somebody interested. He’d give us a background of them. We would then decide if we wanted to meet with them or not. We always try to do at least one meeting with them. After that, it went boom.
I visited with Keith at a meeting up in Denver. There's a real relationship that gets started between you as the business owner and your broker like Keith. Do you want to comment on that relationship?
[caption id="attachment_5002" align="aligncenter" width="600"] Selling Your Business: When you’re planning on selling your business, call a broker ASAP.[/caption]
He's got such a calming demeanor about him. There were a lot of times where we were stressed out and the requests some of the buyers were asking for like producing the documents were repetitive and things.
We had one buyer that we went down the rabbit hole with him. He was a horrible man. He wanted everything for free. He wanted us to pay him to take over the business, put it that way. Keith kept his calm. He's thorough and his demeanor is amazing.
He didn't get rattled and he took a little bit of verbal abuse from that one buyer. He hung in there and let it run off his back and we eventually moved on from that particular buyer.
I think about the emotional toll and for you, you'd run the business for many years. It’s like a family member. Having somebody to be able to come in a little more objective and not emotionally tied to the business has value.
He opened our eyes to a lot.
You say that's a normal request. We're used to it. For you, it may be the only time you've ever sold a business. For Raincatcher, they've sold hundreds of businesses so their perspective is nice to have on hand. You have been out of your business. It's sold. Now that you've got some distance from the transaction, what's life like now?
For one of us, it's nice.
The stress level is night and day from where I was when we were almost ready to sell. We had been close to a couple of deals previously and try not to get too excited about the one that finally did go through. That was part of Keith’s educational processes. You’ve got to wait until it's completely done and not get wound up. The stress level has got to be the number one thing.
If you were going to go out and let's say you had a family friend or whatever that was getting ready to go through the process you did on selling your business, what advice might you offer them that you wish you had received before you went into your process?
Call a broker ASAP. Don't mess around, not unless you're selling to a family member. Even if you're selling to a family member, Keith or Raincatcher will take care of your interest. I refer them all the time to some of my clients that are close to being retired and stuff like that. I don't know if any of them has called, but I keep putting out their name.
For many business owners, you work, make cashflow, pay your bills and so on. At some point, I don't know how much thought goes into, “We need to prep for sale.” I don't know if that's much of the thought process when you're running a business.
You think you're organized and then there's being organized to be able to sell a business. It’s having your books clean and all those little things. They go through them with a fine-tooth comb and there are a lot of questions that are going to be thrown at you regarding this and that and what is this for. It’s being as prepared as possible and don't think you're going to do it in 30 days or 90 days or something like that. It's not that quick of a process.
It is truly a journey. For you, having built the business and run the business for many years, that wasn't by mistake. You guys deserve a lot of credit for taking, buying, building and running the business for all those years. That's quite a feat. It takes courage to take and go through the process of selling a business as well. You have been kind enough to share your experience and wisdom from the sale. Is there a piece of advice or anything that you would like to close with for anybody else that's maybe thinking about selling a business?
[bctt tweet="You think you're organized in your business and then there's being organized to be able to sell a business." username=""]
That makes it simple. From my understanding of the Raincatcher process, they've got a robust questionnaire that helps you define strengths and weaknesses. That's important for everybody.
You know the difference from when we were trying to do it ourselves to when he took over. He had in 30 to 45 days prospective buyers and we were meeting with people in six weeks.
That's quite gratifying if you come from a place where you're hunting for a buyer, and then you go to the place where you have an abundance of buyers.
It’s nice to see the abundance of how many people were interested in King Kong.
That's one of the unheralded values that you hear or don't hear about is can they sell your business? The flip side of that is do you have an inventory or supply of buyers that are interested? If you've got an abundance of buyers, it's clearly in the seller's favor. Donna and Gary, I can't tell you how much I appreciate you taking the time to share your story, journey and perspective. I can't thank you enough.
Thank you. Let us know if you need anything else. We're always here. They've done such an amazing job. We’ll always be here for them if they ever need us to speak to anybody or anything like that.
Thank you. You take care. Make it a great rest of your day.