,For those who are wondering how to exit or sell your business, I bet the first thing on your mind is making sure it is a seamless process.
Less complexities = less worries.
But where do you even begin? What steps are the best steps to take on this (seemingly) long and winding exit path?
Luckily, this week’s PPMP podcast guest is here to help. Julian Whitehead, partner with Whitehead Legal, exclusively advises commercial matters in the healthcare landscape throughout Australia. From veterinarians to health entrepreneurs, Julian has been serving allied health practitioners for almost a decade.
Working remotely in Melbourne and Sydney, Whitehead Legal works with businesses of all shapes and sizes.
So no matter if your business is a startup or a large-scale clinic, Julian’s essential tips and insights are here to make things easier.
In essence, understanding how to exit or sell your business will look a whole lot clearer after listening to this episode.
Since I often get asked: “What do I have to do to sell?”, I’m over the moon to be able to share these insights with all of you.
Julian and I dive deep into each topic and the process behind exiting or selling your business. We take you from start to finish – from succession planning, to getting ready to sell, to the many steps involved in selling.
Before you settle in for this episode, let’s jump into some main topics.
When Should a Business Owner Engage a Lawyer?
While 50 minutes isn’t enough to cover all the touch points where an allied health business owner should get a lawyer, Julian doesn’t cut corners.
From the best place to start to where allied health business owners have failed in the past, he explores the essential areas where business owners need to legalise.
Our conversation essentially demystifies the legal side of it all – something I personally would have appreciated when I had my practice. (Good thing my lawyer was my neighbour – quite a few helpful over-the-back-fence conversations there.)
At the end of the day, it’s about recognising that you have something sellable. A sellable entity with commercial value.
Do you have an exit plan? Have you thought about starting to build and protect assets if you’re going to sell? These are all important things to consider when embarking on the journey of getting yourself out of the business and clinical operations.
As much as anything, a lot of it revolves around your mindset. Do you have a lawyer on hand for any and every question? Ultimately, you don’t know what you don’t know.
Taking Those First Steps
From service provider agreements to protecting the goodwill of the practice, Julian gets into the nitty-gritty of the initial steps.
To have those employment agreements and other important documents crystal-clear and signed is part of what goes into the box of what you sell.
Julian discusses intellectual property in the episode, including the two elements for factual registration that are integral to the process.
We even take a gander at what happens when there is more than one business owner.
An ongoing agreement, the value of the practice, whether you’re selling to an independent third party…Julian explores which documents are critical in the early stages of practice life.
Getting Ready & Going For It
I took 10 years to sell my practice.
I’m pretty sure most people are quicker than that. But those 10 years were during a context when businesses weren’t necessarily selling.
Nowadays they’re being traded day in, day out.
Many listeners would probably be surprised at the volume of trade that goes on behind the scenes. The banners on the front of the buildings don’t always change.
So, what are the next steps once you’re in that position of, “Yeah, I want to sell” or “I’m ready to exit”?
Julian shares exactly what you should do, like making sure to speak to your advisor or lawyer. There are a number of critical due diligence items that must be disclosed, and it’s no good to provide certain documents the day before a settlement. (Chances are you won’t really be settling.)
Listen to the episode to hear Julian’s full insights on some of those intricate due diligence items and why they’re important.
In the end, Julian and I have only skimmed across the top. But, you can never learn too much or too little.
When it comes to learning how to exit or sell your business, there is never any harm in talking to a lawyer and getting the right advice.
If you get yourself and your team ready early, there will be less complexities in the long run.
Seeing as my discussion with Julian covered a wealth of important topics, here is a list of just some of them:
- Internal transitions
- Employees and their entitlements
- Town planning
- Practice restraints and non-solicitation of patients/clients
- Prepaid work – adjustments of debt and credits
- Finance, DD, Covid/lockdowns!
- Typical sale documentation to expect
- New leases or transfers of existing leases and disclosure statements
- Post settlement vendor consultancy agreement
- Liaising with all parties – accountants, practice brokers, lawyers, landlords, agents, financiers (and finance brokers).
So buckle up, get that notepad ready, and get set for an incredible episode.