
Selling your company doesn’t make you happy - ryancarson
http://ryancarson.com/post/24480936689/selling-your-company-doesnt-make-you-happy
======
citricsquid
I've tried writing this comment multiple times and I'm struggling to find a
way to explain it well. We sold our company[1] and part of the sale terms were
we would be retained as the "managers" of the products (websites) and I always
approached the sale as: "We take their money, they use their experience and
assets to increase the value of the products and we continue to manage the
product" and in theory that's what happened, unfortunately I made one big
mistake: I didn't at any point realise how much control (freedom) mattered.

The company that acquired us is fine and I have no problems with them in any
way and I enjoy my job, but it's just so different to how it was before. I
guess a good real world comparison is renting vs. owning, if you own your home
you can paint the walls, install a new floor or turn an entire wall into a
television. When you're renting you're limited to very insignificant and
inconsequential things, you can move around your sofas, have red plates
instead of blue and get a new desk, but what sort of control is that? It's all
cosmetic.

If I ever sell a company again I will absolutely make sure that the sale is
the end of my involvement. If I wake up in the morning and have control I can
think "today I'm going to make my company so fucking awesome, yeah!" because
the sky is the limit, but as an employee it's just "oh, today I'm going to
work... my goals are x and I can't change that" and when the former was
previously possible and is no longer an option it's very depressing. I guess
depressing is a dramatic word, but that's how it feels. Maybe stifling would
be better, or trapped.

[1] I say company but the company was just for the sake of legalities, we
didn't have an office or any formal structure, we just ran a couple of
websites.

(I've been thinking about this for a while now and this blog post reminded me
how I felt, sorry if the comment is too off-topic)

~~~
ryancarson
Great comment. I felt this acutely in the sale of Carsonified. I had no real
control in the production, marketing or execution of the events after the
sale. Thankfully the company that bought us did a good job and everything went
fine.

You're absolutely right though - everyone who's selling a company should think
very hard about what their involvement is going to be post-sale.

------
pg
It depends on your circumstances, and specifically whether (a) running the
company is what you most want to spend your time on and (b) whether you want
liquidity and diversification.

I didn't want to spend my life running Viaweb, and I did want liquidity and
diversification, so selling it made me very happy.

~~~
larrys
"running the company" is much much different than "running your own company".

After I sold I had to stay for 3 months for transition. That was brutal. I
couldn't have been unhappier and felt that those three months would have been
super valuable to get a head start on the next thing (which took about 5
years..)

If I did it again I would make sure that the consulting time was on an "as
needed basis" and not 9 to 5 or any fixed period.

One interesting thing though happened. After the consulting was over I went on
a ski trip. I was called during the trip because they had some system
problems. Solving those problems I really enjoyed doing and I continued to do
that free of charge for the next year or two. My payback was simply hearing
the appreciation (this was back in dial into system by 2400 baud modem days.)

~~~
pg
Yes, it's rarely pleasant working for an acquirer. We tell founders who are
thinking of selling to factor that pain into the price.

~~~
alexknowshtml
When do you tell them that? Before or after you've invested?

~~~
brlewis
"Founders who are thinking of selling" is a clue that it's after YC has
invested. But obviously it's no big secret since he's posting it on a public
forum.

------
clarky07
While I agree with the sentiment, the freedom provided by an exit (or
alternately just a very profitable company) is certainly something that can
make someone happy.

It isn't the 0's in the bank account, it's what they provide. It means you can
work on bigger projects with more funding requirements. It means you don't
ever have to worry about how the mortgage is getting paid next month, because
you don't have one. It means you don't have to worry about how to get health
care to take care or your aging parents, or how you are going to get your kids
through college.

These are some of the biggest problems in life, and all of them go away with a
big exit. Then you can spend your time focusing on the things that make you
happy, which is probably for many of us building another company. The point is
that it removes some stress and some worries, and that is a very good thing.

~~~
ryancarson
Agreed - the extra cash makes some basic problems go away. Once those hurdles
are removed though, you realize they weren't hurdles at all - they were just
part of being alive.

~~~
larrys
"extra cash makes some basic problems go away"

"basic problems" are an important thing to make go away.

Let me put that a different way from my personal experience.

Some things that money can buy can make you happy obviously. Of course if you
feel like crap that day for any reason the fact that you have those things
that money can buy won't change that.

Having money means importantly being able to avoid things that make you
unhappy. Small living quarters. Bad food. No air conditioning. A car that
breaks down.

Added: To name only a few things which vary in importance depending on the
individual.

~~~
slurgfest
For people who don't really know anyone who's poor, it's hard to see that it's
not all about iPads or even good cheese and air conditioning and square
footage.

Broken teeth you can't afford to get treated. Family members with psychiatric
disorders no one can afford to help (or, the available medicines cause side
effects that make life completely miserable). Busted plumbing and busted roof
you can't fix properly. Aging parent without necessary full time care, but you
still have to have a job. Both you and your spouse having to work to support
your kids, who you have to put in cheap daycare which they hate just so you
can go to work. Living in a trashy, high-crime neighborhood. Having to drive
four hours to get to a place which will give you birth control at an
affordable price. Getting treated like dirt by a scumbag boss at a job you
can't leave, for years. Getting turned down for interview after interview
because of the heuristic that you must be bad at what you do if nobody else
hired you. Fighting and stressing over money to the point of divorce, when
just a little money could have smoothed it over. Actually worrying about how
you are going to live when you cannot afford the place you are living. Having
the scorn and disregard of most of society until the day you die.

Yes, there are alternate solutions and little consolations and some possible
ways out, if you are in a developed country, if you are smart, if you are hard
to discourage, if you are lucky.

But when a normal middle class income so easily makes these problems into
implausible memories, it can be pretty insulting to hear smug sayings like
"money doesn't buy happiness" from people who have decent secure income.

So to be a nice empathic middle-class person, don't say those things in public
unless you are prepared to go full Buddhist (and put your money where your
mouth is).

~~~
theorique
How about: "money does not buy happiness, but it can mitigate a whole lot of
the misery associated with lack of money".

For an analogy - it's no more fun swimming in a 500 foot deep lake, than a 50
foot deep lake, but a 3 foot deep lake with rocks and waves is painful and
dangerous and no fun.

The baseline of money that eliminates misery ( == "buys happiness") is that
which takes a person from "really poor" to "modestly middle class".

~~~
larrys
I like that example. I use a similar analogy to that frequently. If you are in
a room with a ceiling that is even a few inches over your head you don't have
to stoop at all. It doesn't necessarily benefit you if the ceiling is 3 inches
over your head or 10 inches or 10 feet (with respect to walking that is - add
some room for up and down etc.) On the other hand things become tremendously
difficult if the ceiling is even an 1/8 of an inch lower than it needs to be.
In that case you have to stoop and you can't walk normally.

------
aaronbrethorst
I built and sold a company last year. It was relatively small, but being able
to go from an idea to acquisition in less than a year was incredibly
validating to me, and that definitely made me happy.

Also, having extra cash in the bank means I have to worry less about how I'm
going to pay rent this month, giving me more time to think about and do things
that do make me happy, like spending time with family and friends, and making
things.

Money can't buy you happiness, but it definitely doesn't hurt.

------
Cushman
If you're a normal human being, you're likely to notice over time that the
things that you think will make you happy, when they finally happen, don't.
It's just something people are really bad at predicting.

If you're a normal human being, probably the only thing which actually makes
you happy at the end of the day is helping somebody else selflessly-- best is
if they don't even know it was you.

We're weird animals.

------
jaems33
Selling for a good profit gives you the flexibility to do other things that
you want to do, especially things that require capital, like starting a small
team of devs and designers to work on another startup or creating a private
space transport company.

So many artists around me would just love it if they could have even a
marginal exit as to be artists all the time. However, most (as in, 99.9%) have
to take a full-time job to make ends meet.

My point is not to say it's disingenuous to state that selling a company
doesn't make a person happy. But I think one cannot underestimate how those
finances helped to further happiness and even continued success.

------
saddino
There's another, very salient reason for selling your company. But only if you
are a serial entreprenuer:

An exit validates your ability to build to sell and may move you ahead of the
pack when a potential angel or VC calculates your probability for a successful
exit, especially compared to others who are "unproven."

------
ericabiz
Related (from 2007 but still relevant!): [http://www.erica.biz/2007/hitting-
the-jackpot-doesnt-mean-in...](http://www.erica.biz/2007/hitting-the-jackpot-
doesnt-mean-instantly-becoming-happy/)

This does seem to be a consensus amongst successful entrepreneurs.

~~~
ryancarson
Great post - thanks for sharing

------
davidw
Paul Graham seems pretty happy doing Y Combinator, and what I've learned of
him from the internet makes me think he's better off there than running the
same company he started 'back in the day', both personally and in terms of
what he's giving back to the world.

------
soup10
If you haven't already met your financial goals, then selling your company
should help, and that should make you happy.

If you have met your financial goals, then the only reason to sell is if you
aren't enjoying what you're doing or want to move on to other things. In which
case selling gives you the freedom to do that.

It sounds like the author got a big pile of money and it didn't make him as
happy as he thought it would. No surprise there, it's pretty well known that
money doesn't buy happiness _.

_ Beyond about 75K/yr or so
[http://www.time.com/time/magazine/article/0,9171,2019628,00....](http://www.time.com/time/magazine/article/0,9171,2019628,00.html)

------
GigabyteCoin
'The grass is always greener on the other side of the fence' is what my father
always says.

He is a man who spent much of his youth traveling the world trying to 'find
himself'. He ended up moving back to the same town he was born in.

~~~
hornbaker
"The grass is always greener where you water it" is my preferred version.

~~~
mechanical_fish
"The foolish man seeks happiness in the distance. The wise grows it under his
feet." -James Oppenheim

(I stole this quote from the chapter titles of _The Philosopher Kings_ , a
documentary which I saw on a plane last week:

<http://www.philosopherkingsmovie.com/about/about-the-film/>

I liked it.)

------
spiredigital
Awesome post. Whether or not you'd like to sell a company for millions isn't
the point - the point is that buckets of money won't make you happy, and it's
really not what drives most successful entrepreneurs. Good entrepreneurs look
at the money primarily as a scorecard and validation of their efforts and
ideas. Is the money great? Sure. Does it buy some comforts and remove some
stresses. Absolutely. But never mistake it for what really creates passion and
happiness.

It's funny how as we grow we always move our bar and expectations. I remember
when I first started my company, I thought "If only I had X orders and $X in
revenue per month! I'd be set!"

Well, now I do have $X revenue. And I don't feel any different, just like he
discusses. I simply have created a new "if I only" in my mind that drives me
forward.

I think the trick is to continually be pushing forward toward growth and
improvement while realizing that if you can't be happy with what you have, you
likely won't be able to after a large, multi-million dollar exit.

Easier said than done, right?

~~~
chmike
So the odds are that you will fail soon or later with the last objective you
won't be able to reach. How would that feel ?

------
ry0ohki
All due respect Ryan, but were those life changing dollar amounts for the
acquisitions? I seem to remember DropSend being sold on your blog, and
Carsonified was a consulting company or something from what I can remember?
Not to take anything away from your accomplishments and I 100% agree that
money will never make you happy, but if you had gotten say $500 million from
your acquisitions would the story be any different?

~~~
ricardobeat
Going into the billions must be a completely different story - it's _world-
changing_ money, not just life. The things he talks about still don't change,
but you have the power to achieve much greater goals.

------
dchuk
I might be late to this thread here but my question is: how do you go about
selling your company for low 7 figures? I'm not asking how to make it worth
that, my question is assuming that's a reasonable price for someone to buy
your company for.

Do you mark it as for sale? Are they mostly private offers? Go through a
broker?

Basically, I'm interested in how to actively put up for sale a company that is
too big for something like flippa.com for instance

------
johnst_nhb
"Its true money can't buy you happiness. But it can buy you a big fucking
yacht to pull up along side it."

-Diamond David Lee Roth

------
joelhaasnoot
Going through "getting out" right now - essentially selling my chunk, but not
sure what I like better: the uncertainty of a young startup or the stress of
haggling with partners what my share should be worth.

------
slurgfest
I think people have come to undervalue proprietorship. In other times and
places, it was/is a good thing just to have steady work as (say) an innkeeper.
If we consider this as just an income stream, it's not much to strive for. If
we want to be pointy-haired bosses, it seems pathetic. But a self-sustaining
way of life offering some fulfillment is valuable, and not everyone can have a
self-sustaining way of life where they order around lots of other people.

------
geoffc
Selling OpenAir was a very positive experience. It gave me three things. A
tremendous sense of accomplishment, financial security and most importantly
the freedom to go back to the most exciting and difficult part of business,
building startups from scratch.

------
nsxwolf
Ryan, I would like to take your advice, but only for my second hypothetical
company. I need the zeroes, even if they come with regrets. I can use some of
the zeroes to start company 2, at which point I will start following your
advice.

------
halayli
Again with these titles. speak for yourself.

~~~
ToesByNoon
Exactly. I'm sure the instagram guys are crying their eyes out right now, and
wiping their tears with hundreds.

------
someguy999
Coming up to the end of several years of vesting after an acquisition. The
acquiring company has been absolutely awesome and fun to work for, but its
nothing like being in complete control of your destiny as a startup founder.
You have a boss, you have smaller aspirations, its impossible to have as large
an impact, and you have to push through lots of people to try new or risky
things. The best you can hope for is a non-dysfunctional and creative
organization, and I've been extremely lucky to have joined one. But I still
miss the wild west of the scrappy startup phase, there really is nothing like
it. PG's post about humans in their native habitat is spot on. You remember
very quickly what it's like to be a caged animal when you are acquired.

That said, I think the author of this post is glossing over a major point.

When you're doing a startup in your 20s with essentially zero net worth,
you're taking a massive risk. If you get sick, if your family members get
sick, if you end up busting up your car, if your landlord throws you out, and
so on, could all be complete disasters. Of course, you (generally) know this
going into it but the reality is most young first time founders are dancing on
the edge of disaster, on all fronts. (As I was) I know you're _supposed_ to be
financially secure before you start a company, but in practice this means 6-9
months of living expenses, and you still are one or, if you're very lucky, two
disasters away from total ruin. If you want to be successful, you almost
_have_ to jump in when it feels dangerous to do so, because if you keep
delaying for safety you'll never make the jump as your standard of living
rises to meet your salary and so on.

Now, after an acquisition and the admittedly grueling process of going through
a payout schedule, I am of the mindset that finally getting to a solid payout
is going to be a life changing event for me. No, not because I will buy fancy
cars or go on lavish vacations. In fact, I expect my standard of living to
_decline_ as the low-risk returns I expect to earn on my payout in the markets
will result in a virtual "pay cut" for the time being as I prepare for the
next adventure.

But what it _will_ mean is I can have another thrilling startup experience
(for all the reasons most people do it) without all of the truly scary, risky,
life-endangering consequences. Sure, the startup can still fail and I can
waste my time. Sure, I will still need to think frugally. But if disaster
strikes, I (or my loved ones) won't end up bankrupt, on the streets, or dead.
Also, until I jump back into the game again with a solid team and idea, I will
be free to experiment and pursue where ever my curiosity leads me in finding
that idea without the pressure cooker of "maybe I should start doing
consulting again soon to pay the bills."

I haven't gotten quite to the finish line yet, but I have to imagine it will
be a very liberating feeling, as long as I have a clear perspective on what
exactly money can and cannot do for me, and how I should take advantage of the
opportunity of having a few million in the bank. For me, its about freedom
from having someone control my life, and removing the ambient risks life has
without financial security, not about material things or indulgences. I'm so
happy to live in a country where having one lucky break of an exit of a few
million dollars can bring about this type of freedom if acted upon wisely.

------
serverascode
Some people don't know how to retire.

Some people don't want to.

------
aneth3
This article is out of touch with what it's like to not yet be a financially
independent, respected, and successful entrepreneur.

Making a few million dollars, one path to which is selling a company, solves a
huge number of problems. You stop worrying about making rent, take a year off
and start something new without worrying about a paycheck, return to school to
change careers without risk, have children and afford a babysitter, build the
company you want to even if you don't have confidence it will succeed, hire a
maid, have a lawyer do your taxes, have price insensitive vacations, wear
fancy hats and expensive suites and deign to tell people how little difference
money made in your life, ... shall I go on?

