Dallas, Texas, 11/03/2015 /SubmitPressRelease123/
Mike Young Law – Sell an Internet Business – 5 Expensive Mistakes to Avoid
Dallas, Texas / Submit Press Release 123 /
By Mike Young Texas Internet Lawyer
Here are five common mistakes that Internet entrepreneurs make when trying to sell an online business.
Mistake #1 – Failing to Identify What You Want
The day after your ecommerce company is sold, what are you looking to do with the next stage of your life?
Some sellers want to walk away and never look back. Others want to retain a role with the company they’ve just sold – as a consultant, an employee, or an informal mentor to the buyer.
If you want to stay involved with the company, how long do you plan to stay? 60 days? A year?
Answering these questions will help you structure your offer for sale so that there’s a good fit with the ultimate purchaser.
Mistake # 2 – Working for Your Earnout
Although it’s common for some sellers to stay on as consultants or employees for a period of time to ensure a smooth transition for the buyer, that’s different than an earnout where part of the compensation paid for your business is contingent upon future events, such as the company achieving certain post-sale milestones.
Too often, sellers will commit themselves to working for the company for one to two years without any additional compensation than the earnout.
In essence, they’ve deducted the amount of the earnout from the sale price and are working for that amount of compensation as employees or consultants for the period of time.
While that’s typically a good deal for the purchaser, it rarely makes sense for the seller when one takes into account the labor involved and lost opportunity costs.
To read all the 5 mistakes to avoid, visit http://mikeyounglaw.com/sell-an-internet-business-3/
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