How to Shut Down Your Business

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Today’s question from Asa in Sweden may not pertain to you directly, but I have a hunch that whether or not you plan to shut down your company, there’s learning in this lesson for you too. She asks:

“I have decided to shut down my life-coaching business (after 5.5 years) and focus my efforts on my passion project. I started a podcast and am enjoying the process, meeting cool people who have opted out of the rat race, sharing my journey, and learning from others. I know you have shut down several businesses in the past, and I guess my question is, how do I do this?”

I’m a big fan of anyone who follows a path that feels aligned for them, on their terms. So kudos to Asa for doing that. One point of clarification: I’ve never closed my businesses. I’ve either systemized them to a point where they run passively (by training someone up and turning the day-to-day operations over to a member of my team) or sold them. That said, I’d like to address some options to shut down a business:

• Consider what assets you have in the business (for example: email subscriber list, physical inventory, intellectual property, audience demand, a well-oiled team, repeatable revenue, courses or programs, etc) which might be saleable in part or parcel. This could allow for some or all of the business to continue without you and keep serving your existing customers. It also can result in your getting paid out for your efforts to build to that point. Here’s an article I wrote on simple steps to sell a business, no matter its size.
• If selling isn’t the route for you (perhaps you know in your gut that you’re done with this endeavor and ready to cease work on it quickly, and/or there isn’t anything to sell), you can decide if and how you’d like to alert stakeholders. If you have teammates and/or investors, you’ll want to share the news with them first. Then, consider vendors, partners, and clients/customers. If you’re a solopreneur and currently have no clients, you could make the choice to close quietly. If you choose to share more broadly, there are opportunities for others to learn with you and normalize endings as part of the journey.
• There’s also a middle path where you train someone to take over, but you remain full or partial owner. In the case of a business like life coaching, where it’s dependent…