Selling insurance agency to employees
2 min to read

MYTH #3: An Internal Buyer is the Best Buyer


Allow me to share the story of one of our past clients:

Robert* was a 2nd generation agent. He built a highly successful niche agency over several decades, dominating the market that he served. As he approached retirement, he sought to perpetuate the business to ensure both his clients and employees were taken care of.

Robert’s first desire was to sell to his key producers to keep the agency local. After failing to get the producers to agree to his price, he went to ABC for a 3rd party valuation. To his surprise, ABC came back with a market value significantly higher than he had proposed. After further discussions with his key producers, he moved forward with hiring ABC to handle the sale process.

ABC prepared the agency for market, disclosed over a dozen larger, strategic buyers, and coordinated meetings with each group to allow Robert the opportunity to ascertain which was the best fit. At the end of the process, he had 6 offers from a variety of firms and the ability to negotiate the best offer with the right firm to take over his agency. Due to the buyer’s size, Robert’s team gained the benefit of better resources and support.

In the end, Robert achieved more than double what he expected from the sale and left his agency in good hands. Many months after the deal closed, I called to check in with him and received a heartfelt compliment: “Calling you was the best decision I ever made.” We were happy to help and he is still good friends with our team many years later.

ey Takeaways: 1) Professional Guidance. When it comes to selling your business, you don’t know what you don’t know. Seek expert advice. We’ve helped hundreds of clients through successful perpetuations. 2) Emotional Buffer. Selling a business that you have invested your life into has an emotional toll. Experienced advisors play the role of counselor and intermediary throughout the process, alleviating friction that can develop between you and other parties. 3) Maximum Sale Price. Going to market exposes you to a variety of buyers, some of which you may not know, and puts you in the driver seat of negotiating the best deal with the best buyer. 4) Peace of mind. You only get one chance to sell your agency right. Going through a professional process gives you the peace of mind that you explored options and did it the right way. Summing it Up: If you are considering selling to friends or family, seek the advice of a professional M&A advisor. It could be the best call you ever make!

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