Welcome to the third article in a series devoted to those of you that have built a business that is successful enough to attract buyers, and you are thinking of selling it. There are many ways to increase your business’s valuation: recasting financials, improving the management team, upgrading technology, documenting your business policies, procedures and intellectual capital are just a few of a multitude of actions you can take.

When thinking about how to sell a business – or just trying to manage and grow it better - consider the board as part of the package. A stellar board of directors enhances performance of a business as well as its reputation and identity. Before offering your company for sale, create a board if one doesn’t exist. This effort can take as little as three to six months if you’re starting from scratch. Valuable and in-demand people can take time to connect with, and you will want to launch a new board successfully without rushing.

It can take over a year to change an existing board, especially if you don’t have established term limits and want to allow gracious exits for directors. How does that fit with your timeline to sell a company? If it needs to be included in your exit strategy, integrate it into the timeline.

Examine your current board and decide if all its members contribute significantly or if bringing aboard new members would serve your business and its sale. When we work with clients and new or existing boards, we assure that term limits are set so you can rotate members in a professional manner based on your needs and their qualifications and performance, and to sell the business. Selling a company requires different skill sets, and can be used as a honest and graceful way to move board members off the board.

Evaluate current and prospective directors not solely for their contribution, but also consider how a buyer would view them. For example, a business looking to expand into international markets might bring aboard directors with relevant experience or an academic expert in the field. It signals your commitment to bring targeted and objective advisors on board.

The board could be comprised of family members who have professional credentials and members inside and outside of the firm. In a private company, it’s acceptable and expected that family members and insiders will dominate, but expert outside board members can bring significant insights and useful networks that potential buyers will value.

Your selling effort should include your board, especially since they and company shareholders will approve the final deal. You could involve the chairman, certain directors, or set up a special committee to be an objective resource for evaluating various alternatives and buyers.

If you’re uncomfortable establishing a board of directors, consider a strategic advisory board. Unlike a board of directors, a strategic advisory board bears no fiduciary responsibility and has no organizational control over management. It can offer constructive expertise, support, and guidance to you and a new owner without governance and administrative duties of a board.

Being a business owner can be a lonely position to be in. To avoid ‘drinking your own Kool-Aid,’ bringing in a strong board of expert and objective directors or advisors has real value to you as you begin the process of selling a company that potential buyers will value highly.

I invite you to use these ideas as you start the journey to sell a business.