It depends on how you buy the business. There are 2 fundamental ways to buy a business. A Stock Sale or An Asset Sale. You will probably want to do an asset sale. An asset sale means that their entity (LLC, Corp, etc.) sells its assets to you or your new entity. This is the best way to keep their liability with them and not have it transfer to you in the purchase of the business. It also literally means that you need to set up new accounts for everything because nothing will technically transfer to you. Prior to the closing, you and your advisor and the sellers should meet to discuss the policies that need to be in force as well as any licenses that you need to apply for. Things like a new EIN number, payroll company, bank accounts, lease deposit, insurance policies, liquor license, food handling certs, etc. You should be able to call their current policy holders and ask for the same policy but under your new EIN number. or you can take their current policies and shop them around to other insurance companies or brokerages to try and find better rates. More on reddit.com

I've just finished putting together the world's most comprehensive article on business brokers: here (from 35 years of experience dealing with them). It covers probably every possible question you could have on the subject. Read that and AMA.

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I have sold my first business when I was 26. I am 45 now and have done this 2 other times and I am getting ready to do it a fourth time here are a few pieces of blunt somewhat unsolicited advice that I would share with you. the brokers at this price point are glorified residential real estate brokers. They are full of sh—, looking to get you to sign some sort of exclusive agreement to market your company. You don’t need them but they 100% need you. If the broker has a buyer then he should go convince the buyer to hire them. They don’t have anything other than a Rolodex of people with money who may or may not have any interest in this sector let alone your business. if someone buys your services company you can bet they will want you to stay on and deliver on the projections you are making to them. That new buyer is going to present you with an offer that seems amazing up front to get you into a sales process and during the course of that process will add qualifiers that will require you to meet those projections in order to achieve that price. It might be an earn out, it might be equity in the Buyer or convertible notes but they aren’t going to buy your business without the talent being locked the f-in during a substantial transition period. You are the product after all not the client list or as Jack Welch once described his acquisition of Kidder Peabody “the tables and chairs.” You are going to work like an animal and chainsaw the business to the bone to make it happen and then once it’s done you will either get your money and be asked to leave or not meet your projections and get less money. The pressure won’t be less it will be a lot more. 3) Resist the temptation to start thinking the exact way you are thinking right now. You already thinking about the life you are going to lead with a ton of money and no responsibility. You have not prepared any marketing materials to sell the business let alone talked to any actual buyers to see if they are even real. Once you actually get an offer that is only the beginning and not the end of the process. Diligence and deal making is a soul crushing joyless exercise that takes months on a good day. Operate under the assumption this will be a 12-18 month process once you find a buyer to close a sale and then you have another 18-36 months of working with your new boss. I am not saying this isn’t exciting but you don’t need our advice at this point! More on reddit.com

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