Exit planning starts on day one, not the year you decide to sell

Ryan sat down with James Shin, a Certified Business Intermediary who owns the Seattle Metro office of First Choice Business Brokers, where he represents owners buying and selling businesses across the region.

Starting the business

What made you decide to start this particular business, and what were you doing before?

I spent years in corporate IT at a Fortune 500 company. Toward the end of that run the company offered an early retirement package, and I took it.

I had already been working as a real estate agent on the side, so I was not starting from zero on the deal side of things. Business brokerage sat right between the two. It uses the transaction work I had been doing and the analytical side of the corporate career at the same time.

What nobody tells you

What has been the biggest challenge of owning a business that you did not anticipate?

Feeling financially responsible for my agents.

When it is just you, a slow month is your problem. Once you have agents, their income runs through the same pipeline you are managing. That changes how a quiet stretch feels. You are not only thinking about your own numbers, you are thinking about whether the people working with you are going to be okay.

Nobody warns you about that part. It is not in any of the training.

If you could go back to your first year and change one thing, what would it be?

I would have built learning cadences in much earlier.

What I mean is regular, structured time set aside to get better at the craft. In the beginning you learn reactively. A deal hits a problem, you scramble, you figure it out, you move on. That works, but it is slow and it is stressful.

Setting a rhythm for it, a standing block where you study the market, review deals, sharpen the parts of the job you are weakest at, would have compressed a lot of that.

Strategy and growth

When you started, what was your strategy for your services and long term growth?

Quality of connections over volume of connections. I would rather have a smaller number of relationships where people actually know what I do and trust me with a referral.

The other piece is how you show up in those relationships. Make your client the star of the story. Champion their journey, not yours. If you are the loudest voice in the room talking about your own track record, you are doing it backward. The work is about their business and their outcome.

Finding the first clients

How did you land your first client?

A small dog grooming business. I reached out directly. There was no referral network yet and nobody was calling me, so I went and found people who might need what I do and I asked.

Proactive outreach is unglamorous and it is the whole game early on. You do not get to wait for the phone.

The hard stretches

Deals stall and deals die. How do you handle that, and how do you handle the lean times?

You go back to fundamentals. When a deal falls apart, the answer is almost never something clever. It is the basics you let slide.

The bigger risk is complacency. A good run can make you comfortable, and comfortable is where you stop doing the activities that produced the good run in the first place. So the discipline is to keep working the fundamentals when things are going well, which is exactly when you least feel like it.

Picking a market

Do you focus on a specific industry?

No niche. I like the range.

Every business is a different puzzle, and the troubleshooting is the part of the job I genuinely enjoy. Different industry, different set of problems to work through. If I only did one type of business I think I would lose that.

Advice for owners

What would you tell an owner who is thinking about selling?

Two things. Prepare the business before you take it to market. Clean books, clear operations, a business that does not live entirely inside your own head. Most of the value gap I see between businesses that sell well and businesses that struggle comes down to preparation.

Then pick your broker carefully. You want someone compatible with how you work, and someone who will give you real advice instead of the number you want to hear. A broker who agrees with everything you say is not helping you.

Thinking about the exit

When should an owner start thinking about their exit?

Day one.

I know how that sounds when somebody is just opening their doors. But the decisions that make a business sellable are the same decisions that make it run well, and they compound. Waiting until the year you want out means trying to fix in twelve months what should have been built over ten years.

And success at the exit is whatever the owner defines it as. For one person it is the highest number. For another it is the right buyer, or their employees keeping their jobs, or being able to walk away clean. There is no single version of a good exit. There is only the one that matches what the owner actually wanted.