Exit Planning Strategies
Selling a Video Games Business
A good business is about more than dollars and sense. To make your video games business what it is today, you've had to fully invest yourself in its success. But the hard work isn't done yet. Before you can make a graceful exit, you will have to invest yourself in your business sale.
Dire economic forecasts have forced many video games business sellers into hibernation. Instead of listing their companies now, they're hanging back until they see signs of an economic recovery.
Market timing is a constantly moving target. That's why we think it's important for video games business owners to know that it's possible to sell a business in any economy. To improve sale outcomes, you will simply need to tailor your video games business to today's buyers.
Pre-Sale Checklist
The upfront time you investment in the sale of your video games business will pay big dividends at closing. Perhaps the most important pre-sale consideration is to right-size your expectations to the realities of the market. After you have consulted with a business broker to right size your expectations, you'll need to add several items to your checklist, including financial statement preparation, pre-sale appraisals, financial planning, market positioning and other tasks designed to communicate value to prospective buyers.
Dealing with Buyers
Business sellers sometimes struggle to maintain a positive attitude when dealing with buyers. The questions video games business ask during due diligence are designed to alleviate their concerns about the business and should be promptly addressed by the seller. When concerns arise, it's helpful to base your responses on facts and data. If you don't know the answer to a question, there's no shame in admitting ignorance and telling the buyer you'll look into it. If due diligence drags on too long, your broker may need to intervene.
Sale Costs
In a video games business sale, pricing is based on a number of factors, including the costs incurred during the sale. Although they can significantly increase the final sale price, brokers typically receive a 10% commission. Professional consultations can also represent a significant expense during the course of a video games business sale. Furthermore, your time has value, so you may need to include a personal compensation consideration in your expense estimates.
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