Sold your business. What now?
For years, the business was where almost everything came together.
Time, energy, income and a large part of the family's wealth. And then it is sold. The account shows a sum that once seemed out of reach, and at the same time it feels unfamiliar.
Because the question that follows is one an entrepreneur has rarely had to ask before: what now, with this wealth?
It is not a small question. Below is an overview of what comes your way after the sale of a business, and how families who went through it before arranged their wealth afterwards.
Calm comes from preparation, not from waiting
The first instinct of many entrepreneurs after a sale is one of two extremes: getting straight back to work with a new venture or a stake in another company, or leaving everything as it is for now and deciding later. Both are understandable. Sitting still feels unnatural to someone used to building, and nobody wants hasty decisions about wealth that has to last for decades.
There is a third way, and it starts earlier than most people think: thinking about what should happen with the wealth after the sale, before the sale is completed. Then there is no need to choose afterwards between haste and standstill. The plan is already there; what follows is its careful execution.
That is also why waiting is rarely free. Wealth that sits on the sidelines for a long time because the plan still has to be made does nothing in the meantime, while the value of the business was often negotiated down to the last euro. The calm a seller is looking for does not come from postponing decisions, but from the fact that they have already been taken.
The right structure
A great deal comes together around a sale. The sale itself, the valuation, the negotiation and the guidance of the transaction, is the work of the M&A adviser. We sit on the other side of that process: at the question of which structure the proceeds will land in, and how the family will carry it.
That structure is preferably set up before the sale is completed. It concerns the legal arrangement the wealth will sit in, often in a way that keeps the family itself out of view, the agreements within the family on who decides and how, and preparing for the transfer to the next generation. The tax settlement belongs there too; we make no statements on it in amounts or percentages, that is the tax adviser's domain.
Each part has its own specialist. What is often missing is someone who keeps watch over the whole and makes sure the separate decisions keep belonging together. That is the role we take, not instead of the specialists but around them, and preferably well before the sale is completed. Then the structure can still move with the plan, and on the day of the transfer everything is ready. Families who involve us only after the sale often find that certain choices are already fixed.
The business gave the wealth its purpose. After the sale, the family has to set that purpose itself.
From entrepreneurial wealth to family wealth
As long as the wealth sat inside the business, it had a purpose of its own: the business made it grow. After the sale that purpose disappears, and that is the real shift. Entrepreneurial wealth becomes family wealth, and the two call for very different things.
Entrepreneurial wealth can be concentrated and carry risk, because the entrepreneur had their hands on the controls. Family wealth usually has a different character: it has to provide freedom, withstand weaker years, and often mean something to the next generation as well. It is no longer about growing as fast as possible, but about keeping an overview, spreading risk and looking ahead with purpose. For many entrepreneurs that shift in thinking is the hardest part, and at the same time the most important.
Reinvest, manage, or both
Broadly speaking there are three directions after a sale, and most families choose a combination that may well shift again over the years.
The first is to start again as an entrepreneur: a new business, a stake in another company, or a role as an investor in other people's ventures, because the entrepreneurial itch does not go away. The second is to have the wealth managed in a broadly diversified investment portfolio, with more sources of return than the standard, so that it provides calm and freedom instead of a new full-time job. The third is to give part of the wealth a purpose of its own: for the children and the next generation, for property, or for philanthropy. Not to set it aside, but to arrange it with a clear goal in mind.
The skill lies not in choosing one of the three, but in the balance between them, and that balance should fit the family, not a standard model. Someone who wants to stay involved in business chooses differently from someone who wants distance, and what a family needs in income, what it wants to pass on and how much fluctuation it can bear together determine how the whole is divided.
Why families choose a family office for this
The moment a fortune grows larger and more varied, so does the overview it demands: several banks, participations, property, perhaps something abroad. A family office brings that whole together and keeps direction over it, so that the family does not have to jump from report to report to know where it stands.
Andreas Capital was itself founded by entrepreneurial families, and still works from their question: keeping direction over their own wealth. That is what we now do for other families: the overview, the structuring and the management of wealth, independently, with a licence and under the supervision of the financial regulator in Luxembourg.
Independent is not an aside here: we are not tied to a bank and not obliged to take any bank's products. If a family also wants part of its wealth managed by us, that is a separate choice and never a condition.
Where does your question start?
With the overview
By now there are several banks, perhaps a shareholding, property, something abroad. Each part has its own adviser and its own reporting, and no one has been asked to look at the whole. That is where the family office role starts: bringing everything together on one basis, following how the parties perform, and keeping the family in control.
With the portfolio
The proceeds of the sale are sitting in an account and need to be put to work. That is about the investing itself: a policy that fits the family, a broadly diversified portfolio, and reporting in which you see what happened and why. Management or advice, or both alongside each other.
The two do not exclude each other, and many families start with whichever question matters most at the time.
Is it mainly the overview? Then see our Family Office services.
Is it mainly the investing itself? Then see our Wealth Management services.
What now?
Selling a business is an ending and a beginning at once. Nobody has to decide the next step alone, and it does not have to be decided today, though preferably in good time. If you would like to talk calmly about what suits your situation after the sale, we are glad to think along with you, without obligation and without anything having to be decided straight away.