Calling all entrepreneurs – what are your New Year’s resolutions for 2026? Do you plan to innovate, embed artificial intelligence, or even radically change your business model? Is the new year a time to push for new investment? Or is this the moment you start to plan your business exit?
For business founders and owners, as for private individuals, the start of a year is often a moment of reflection. A time for reimagining and rethinking what the future could look like – a new chapter, filled with potential!
Mark Goddard, Lombard Odier’s UK CEO, believes this is also how a business sale should be seen, the end of one chapter and, crucially, the start of another. Across nearly twenty years working with entrepreneurs, he has gained a unique insight into one of the most overlooked aspects of a business sale – ‘what comes next’.
Entrepreneurs who engage in effective planning pre-sale often achieve the most successful exits. These can become a springboard into new business ventures, personal projects, investing and building family wealth, or realising philanthropic plans.
We spoke to Mark about how entrepreneurs can navigate a business sale with clarity and confidence, avoiding ‘deal regret’ by approaching the exit not as an ending, but as a new beginning.
Selling a business can be difficult, emotionally, for an entrepreneur – they’re giving up something they’ve worked so hard on to build from scratch. How common is it for entrepreneurs to feel regret after a sale? And what are the most common causes?
It varies, but there’s no doubt that some entrepreneurs really struggle post-sale. I recall working with someone a few years ago who successfully IPO’d their business but once the excitement of the transaction had died down, he felt a real sense of loss. He’d been so closely tied to the business for twenty years, it had become part of his identity. He was still relatively young and wasn’t ready to retire, but he hadn’t really considered what life might look like beyond the business and as a result was struggling to find a new ‘purpose’.
These are the two big factors – purpose and preparation. Either they can help smooth the transition to life post-sale or, if they’re missing, they can make it much harder
Defining your purpose post-sale can depend on your stage of life. Increasingly we see entrepreneurs exiting businesses in their twenties or thirties, and at this juncture there is more of an inclination to ‘go again’ and to start another business. Founders who exit later in life, may have different priorities.
Planning ahead, even if it’s only loosely, will help. Maybe you’re interested in non-executive director or advisory work, investing into other businesses, supporting philanthropic causes, spending more time with your family, or a combination of these. You might not finalise the specifics, but it’s important to gain a sense of how you’re going to spend your time and what’s important to you.
As in so many aspects of life, preparation is key. Exits can often feel like a bit of a scramble, suddenly you have liquid wealth and need to update your wills, organise your finances and investments, consider implications for the family, or perhaps buy a new home or holiday property. It’s useful to think these things through a year or two in advance of the sale so that the exit itself is calmer, and you can have a more structured discussion with both advisors and family.
These are the two big factors – purpose and preparation. Either they can help smooth the transition to life post-sale or, if they’re missing, they can make it much harder.
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learn more How much would you say that the valuation achieved plays into this? Are entrepreneurs who achieve higher valuations less likely to feel regret?
There’s always likely to be a greater sense of satisfaction if you’ve achieved a higher valuation, versus selling at a price which the founder regards as not sufficiently recognising their perceived value of the business.
However, it’s also important for business owners to be realistic when they enter the sales process. The price achieved can depend on a number of factors including the market environment you’re selling into and your industry sector. You could have a perfectly good business, but if the current environment for your sector is challenging, you may have to accept a slightly lower valuation. It may even be better to exit at a price below your ideal if there are significant trends playing out in your industry that are likely to put pressure on your business model. That said, strongly performing businesses with a compelling future outlook should find an attractive valuation in most market conditions, hence the importance of working with good corporate advisors to help maximise deal value.
These are some of the factors that can affect the valuation, and the extent to which you are realistic about them will likely impact how you experience the sale outcome.
Read also: What’s your number? Valuing your business and defining your exit strategy
Entrepreneurs sometimes consider staying on in the company after a sale. Does this help soften the ‘cliff-edge’, and avoid regret?
This can make a big difference. Ultimately, whether you wish to continue in either your existing role or another position within the business could shape how you prepare both yourself and the company for exit. The nature of the buyer can also determine whether it is more or less appropriate for a founder to remain in the business.
If it’s an exit to trade – i.e., an acquisition by another firm, often in your sector – some founders may stay on to ensure a smooth transition and then step away. In most instances, a trade buyer will probably want to integrate the business into their existing model and the founder is unlikely to remain involved over the longer term. If the business is heavily founder-dependent then a trade buyer may insist on an earn-out period or link part of the consideration to continued employment. On the other hand, if there’s a strong existing management team in place or the buyer is looking to scale or consolidate, then your role can become less critical.
Answering the question “do you want to stay involved?” is part of your pre-exit planning. Your response to this question is likely to influence the exit route you explore
If it’s a private equity-backed takeover, there will often be an expectation that the founder remains involved, especially if they’re still the driving force behind the business. A private equity buyer will usually want to lock you in for a period of time to ensure that the business continues on its growth trajectory.
Answering the question “do you want to stay involved?” is part of your pre-exit planning. Your response to this question is likely to influence the exit route you explore.
Read also: Navigating the emotional exit: are you ready to let go?
What about the next generation? Does passing on a legacy help entrepreneurs feel satisfied after a sale?
It’s an interesting question. Since the 1970s, certainly in the UK but also in other developed markets, there’s been a clear trend that fewer family-owned businesses are being passed down to the next generation. Partly this is because many businesses now have shorter lifecycles. Owners are crystallising value more quickly, often before the next generation is old enough, or interested enough, to get involved. Other factors have also come into play, including an increase in complexity regarding Inheritance Tax, as well as a shift in the availability of other sources of capital, notably the rise of private equity, which has allowed founders to crystallise value earlier than previous generations.
That said, many business owners are still keen to involve the next generation in succession planning. In these situations, we encourage owners to think about family governance, including the structure of management, control, and shareholdings, so that when they step back, they avoid potential disputes between family members.
Owners need to consider whether they want a full transfer of the business, or a carve-out where a part of the business may be passed on to family members while the remainder is sold. Ultimately, the strategy will depend on what the owner is looking to achieve from their exit and succession planning.
We encourage owners to think about family governance, including the structure of management, control, and shareholdings, so that when they step back, they avoid potential disputes between family members
Closely related to this is the question of what an entrepreneur might want to give their children after a sale. From the many examples you’ve seen, do you have any advice on the best way to approach this?
This varies enormously, and can depend on factors including the age of the children, personal experiences and whether the next generation is deemed ready and responsible, to inherit wealth. I have definitely seen extremes in how individuals approach this topic. I recall discussions with one entrepreneur who had experienced a challenging upbringing and had fought hard to achieve success. He felt that it was important for his children to learn the value of hard work and the reward of personal achievement, and didn’t want to risk removing their aspiration by gifting significant wealth too early. On the flipside, I have worked with entrepreneurs that feel they want their successes to benefit their offspring more immediately, and may choose to buy houses or fund their children’s business ventures or passions. In my experience, most people fall somewhere in between.
What I’ve seen work particularly well is when the younger generation is engaged early in discussing family wealth. An example of this, was when we helped one family use some of the money generated from a business sale to establish a Donor-Advised Fund to support specific philanthropic causes. This engaged the next generation in both how to invest a portion of their wealth, as well as allowing them to see the social impact and importance of responsible stewardship.
There are many potential strategies, but my advice would be to try and involve the family early in these discussions. I have seen problems arise when a family is suddenly confronted with a large sum of money but has had no prior experience of talking about or managing the wealth. That’s when, unfortunately, hard-earned wealth can dissipate quickly.
Read also: Taxing times ahead: is your business succession plan fit for the new UK rules?
Entrepreneurs also need to consider their personal and family wealth management. What do you think is the best way to deploy the liquidity generated by a sale?
When putting together a wealth plan, I always recommend that business owners start with a framework to think through short, medium, and longer term objectives. Liquidity needs, lifestyle, and how you may want to pass on wealth are all important initial considerations. Once you have established your key objectives, you can start thinking about how best to invest funds to support the achievement of your goals. In today’s global environment it’s important to consider investing across both public and private markets. With a longer-term investment horizon, allocating capital to private equity, private debt, or infrastructure can be a powerful way of accessing additional sources of return as well as improving the risk profile of a portfolio.
Fundamentally, what matters most is that investors understand what they are investing in and why. At Lombard Odier, our role is to ensure that clients, who have demonstrated great success and expertise in their own fields, are also well equipped and informed to make strong, long-term decisions about how they deploy their capital to achieve personal objectives and provide peace of mind.
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