May 4, 2020
Today's episode of the podcast, Robert Hirsch from Freedom Factory discusses "When Should I Tell Employees if I am Thinking About Selling".
Listen to the podcast, watch the video, or read the transcript below.
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Transcript of Podcast
Hi, Robert Hirsch from Freedom Factory again. I just had a really interesting email from one of my clients, and long story short, rumors got out among their employees that they were selling the company and he chose not to share that with his team and now it's created some problems for him.
And so I wanted to talk to you today about whether you should tell your employees that you're thinking of selling your company or not. To me, when I sell one of my companies or my advice on it, it's always honesty and transparency is the best policy. That's easy to say and hard to do and you understand the culture at your company and whether you want to have an all hands meeting, whether you want to have an email, whether you want to discuss it. I love talking to our employees about it in a place that's face to face where it gives them the opportunity to talk to me and it gives me the opportunity to comfort them. Depending on the structure of your company, I usually have bonuses or incentives when the company sells, and as an entrepreneur, there's this really important lesson that I learned along the way.
It's, there's no fun winning when there's nobody to high five, and if you're the only one that wins in the sale of your company and all your employees and the teammates and the people that have given the years of their life are worried or concerned about what they're going to do next often you can create a structure that makes it, that everybody wins and everybody celebrates together and, and perhaps, some of your core team is going to want to come with you. Perhaps they transition with the company. Most of the time when a company is acquired, they're going to want to keep the team in place for the continuity.
So ultimately, how you choose to address this question is up to you and it's up to your corporate culture. But often I'll tell a few key members early and the people that are going to help me in the transition, but rumors are unavoidable, and if you don't talk to your team about it, and then the rumors are going to start coming and then it's going to come back to bite you like it just bit my client in the behind and I like to get out in front of it early. I think honest and transparency and creating a game worth winning for everybody is a whole heck of a lot of fun. In that way when you win, you in with everybody. If you have any questions about how to disclose it or what that looks like, just give us a call at Freedom Factory.
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At Freedom Factory®, we have experienced and witnessed the explosive results of entrepreneurs aligning passion and purpose to create extraordinary value. However, most entrepreneurs have no idea how to maximize the value of their business and move on to the next chapter of their lives. That’s where we can help.
Freedom Factory® has radically disrupted the way high-growth,
lifestyle companies are bought and sold, which historically was a
horribly inefficient market. When I sold my first company in the
1990s, I went to several investment banks and sold my business to
one of less than five companies they called. Looking back, I see
exactly how much money I left on the table and knew that there had
to be a better way. The bottom line is that entrepreneurs don’t
speak banker, and bankers sure don’t speak entrepreneur.
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Tyler Tysdal is a lifelong entrepreneur who first discovered the joys and challenges of self-employment at the age of 14. Tyler Tysdal was a collector and trader of baseball cards and his budding entrepreneurial spirit spurred him to create Triple T’s Sports Collectibles, a national mail-order trading card and memorabilia business that found a wide audience through ads in trade magazines. While market inefficiencies were numerous in this pre-internet era, a young Tyler Tysdal experienced his first big business win with $14,000 a month of profit result. A lot of money for 14. It hit him during a ride with his mom to the post office to mail dozens of card shipments: He would likely be an entrepreneur and investor the rest of his career.
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