What Happens to My People When I Sell My Business?

What Happens to My People When I Sell My Business?

The process of selling a business almost always involves more than simple “business” decisions. There are relationships, sentimental considerations, and people involved along the way, too.

Often, even more than concerns about return on investment, business owners wrestle with their responsibility to their employees as they prepare to sell. It’s a common question, and it’s one worth asking: what will happen to my people when I sell my business?

The answers, of course, can vary greatly. For business owners invested in the wellbeing of their employees and business partners, there are many decisions to make that can impact how the selling scenario unfolds. If filtered through the right lens and guided by the right expertise, a sale can benefit a business’s people as well as its owner.

Here are a few things to consider.

1. What role will you play?

This might be the most obvious question to consider, but that doesn’t make it the easiest. In the wake of the deal, what role will the previous owner play at the new company?

There are several common scenarios:

The more involved the owner will be in the new company, the greater say they’ll likely be able to have in determining circumstances for their existing employees. Accordingly, scenarios where the owner remains part of a leadership team may be appealing to owners who want to ensure their people are treated a certain way.

However, in many cases a quick exit can still be orchestrated so that existing employees are well taken care of. The success of this approach will be largely dependent on negotiation during the selling process.

Regardless of the final result, this is a consideration that business owners should dedicate serious thought to, because it will have a large impact on the aftermath of the sale.

2. How will leadership transition?

Additionally, it’s important to ask a similar question on a broader level: how will the sale affect the existing leadership team?

If there are partners involved throughout the selling process, they’ll have their own input to add as they consider their roles in the transition.

There are many scenarios, though, where high-level leadership personnel (for a myriad of potential reasons) aren’t aware of an impending sale until its completion is at hand. In these cases, business owners will want to designate special consideration to how leadership will transition.

Will they function in similar roles at the new company? What will the new organizational structure be? Will they be offered opportunities for career growth, or see their management responsibilities decreased?

These decisions should ideally be made in a way that both increases the stability and value of the business and caters to the desires of the people involved. Of course, that’s a lot to ask, and navigating the process in a way that makes everyone happy with the outcome can be difficult.

3. How will current employees be impacted?

Finally, it’s important to consider how current employees will be impacted by the transition.

Will current employees have job security in the new company? Will they receive any bonuses as part of the sale? Will they have opportunities for career advancement as part of a (presumably) larger business?

Some long-term employees may be averse to the idea of change in general; others may be content as long as their roles are minimally impacted. As a business owner, it’s helpful to have a read on these considerations approaching the sale, so that the process leads to an outcome that people will be able to adapt to.

Want help in navigating the human considerations that accompany a sale?

There are many relationships, people, and interests to consider during the selling process, and handling everything well can seem like an overwhelming task.

We can help.

At Kingsmoor Advisors, we’ve helped business owners to navigate the complex HR considerations involved in selling to attain results that serve people well.

In fact, over more than 30 years, we’ve completed over 100 transactions totaling over $5 billion. That experience allows us to identify the factors that lead to success for invested parties.

Are you considering selling your business? You don’t have to go it alone – and, if you want to ensure the best results for your people, you shouldn’t.

Get the expertise you need to add clarity to the process and drive a better outcome. Let’s set up a time to talk.

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Case Study

The Story Behind the Sale – Maximizing Value and Legacy

Once the necessity of an acquisition was determined, we helped the Etscorns to comprehensively articulate their goals for the business.

After an analysis of consolidation options and careful consideration, the Etscorns were able to find a partner that valued their family’s legacy and was able to exceed their financial expectations.

Bob has great character and composure. He’s acceded to the highest levels of business, but he can relate to anyone.



Improved family’s financial prospects
Upheld legacy of business
Provided long-term peace of mind