Your business is – or will become – your nest egg.
In this excellent blog posting, Nathalie Boutet offers some strategies for keeping a small business alive after divorce, reducing the negative impact of divorce on yourself, your staff and the day-to-day operations is critical.
Quick Divorce = Less Productivity Loss
As the business owner, you may find yourself spending a large amount of time on your case, to the detriment of your company. You may have to show up for hearings, depositions, accounting, and legal meetings. Moreover, a court may involve itself in a business if deemed necessary. This includes assigning a court-appointed accountant in the business. Typically, they can approve or reject a strategic financial deal, creating further disruption.
A preferable option to consider is mediation, which typically results in lower fees and less time spent reaching an agreement – and provides a private process that you are more in control of during an already difficult time.
Keeping a Small Business Alive After Divorce: Who Gets What
Figuring out how much your business is worth is the trickiest part, as you and your spouse must agree on a number that each of you can live with. Your company’s accountant, or a business valuator, can determine this amount. Once you know how much the business is worth and how much is owed to the other spouse, you can consider your options, which includes buying them out.
Again, a collaborative approach is key during this stage. Dividing the assets in a fair and equitable way for both parties can speed up the process and mitigate the financial, mental and emotional impact. In addition, if the other spouse believes that they were treated fairly during the process, they may be more amenable to flexible buy-out methods.
Staying together in the business after the divorce – is it a good idea?
In some cases, exes may be able to continue as business partners after a divorce, but this is uncommon. If professional objectives remain united, a divorced couple may be able to move forward in business together. This is only possible when both parties are in a healthy place of acceptance about the end of the romantic bond and able to accept the ex-spouse as a professional peer. However, in an acrimonious separation where respect has been lost, staying in the business may not be the smartest decision.
Keeping a small business alive after divorcee is possible. With proper knowledge, preparation, and legal approach, entrepreneurs can protect themselves, their businesses and their finances.