Perception of Business Buyers by Baby Boomers

Baby Boomers need to be very careful on the perception of their being multiple buyers for the their business. Having recently seen hundreds of qualified business buyers come through, one thing stood out to me, the vast majority were over the age of 50 years old. Most of these were also looking for businesses north of $3 Million in sales price. The buyer market for the smaller or starter type businesses is bare and there are little to no buyers under the age of 50 years old. Why no buyers? Some of this comes from over priced expectations of the seller, typically poor presentation and lack of key financial info in the asking price. Some comes from lack of buyer funds from recession hit Gen X or student debt burdened millennial's. Millennial's who now have faster, cheaper, more efficient avenues to start businesses with low overhead and scale. Also, they don't aspire to run businesses that can be disrupted or replaced in the next decade.

So you have a large mass market of baby boomers that are looking to sell their business to retire and a bare market of possible buyers under the age of 50. This is a large macro problem, as these are very illiquid assets. The solution is to prepare your business for sale, so you can line up financing options in advance and have more time to find buyers. These buyers are scarce and a prepared sale package will give you the edge. You will need to be at the top of your game to get through the noise and number of baby boomer sellers on the market. Buyers also see this selling process and package, as a reflection of how well you run your business. Your baby boomer competition will spend months in panic mode due to the waste of time, no financing, over supply, poor presentation and inadequate financials.

Selling your business is just like running a successful company. The cream ultimately will rise to the top.