For many years, the sale of companies usually happened because of succession issues. Owners of companies sold their businesses when it was time to retire. That is no longer the case. Founders, or owners, now sell shares in their companies to cash in. In the M&A world, this is called a pre-exit strategy. Owners sell part of their companies but do not resign. They stay committed to the company for an agreed-upon term to further build and expand the company with the help of the investment procured by selling the minority or majority share. After the agreed-upon term has passed, a full exit is made and 100% of the company is sold.
Want to know more about this two-step selling strategy? Read it here.