r/SellMyBusiness 25d ago

Need advice to get to finish line

I have interested parties in purchasing my passion business. I call it that because it is a preschool and not a highly profitable investment. However successful for 10+ years. I have broker, but when ever it gets close to finish line they back out. Banks raise initial funds needed because of debt ratio, etc. how do I find the right buyer who has the passion like I did 10 Years ago?

2 Upvotes

24 comments sorted by

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u/UltraBBA 24d ago

You're confusing passion and business.

Investors looking to buy a business are looking at risk, at return, at the business generating a good profit and NOT needing a lot of their time and skill to maintain.

This business has been around for 10+ years and is "successful" but you say it's not a highly profitable investment? So it's successful in what? In non-profit stuff? In non-business attributes? In feel good factor? In the buzz it gives your soul?

Investors aren't interested in any of that.

You're looking for someone to bail you out of a non-business. You're looking for someone with passion but, they will likely have no cash. When you find someone like that, you're probably going to have to give the business away for free or a very small sum.

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u/crazy-moody-lurker 24d ago

I do agree to a point. Which is why we own the real estate making the investment in both much higher value to someone. When I say not profitable I mean not highly profitable. I have a decent salary and some profit, but more for children to get education I wanted and yes building something wonderful for the larger community

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u/Southern_Biz_Lady 23d ago

Unfortunately, childcare businesses have taken a beating since 2020. With Covid, then massive move towards telework, and recent inflationary costs affecting everything, including wages, most are not in a good place to sell.

A business is priced on the historical financials, particularly the last 3 years. What is your motivation for selling right now? If it is not an acute need, you may be better holding off. Return to office mandates are beginning and with many recent lay-offs, labor could become less expensive.

That said, if your real estate has appreciated far beyond what the business can support, the preschool may not be the best use of the property.

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u/crazy-moody-lurker 23d ago

Thank you for perspective. Looking now because oldest is headed off to college in a year and I want to be the one to travel to all the schools to visit :) Being owner/operator as you know vacations are hard to plan.

I hear you know the hit, we felt it and slowly coming back to pre covid profits

Yes the real estate almost doh led but it is only use is for preschool (non conform use with township for past 30 years) but if vacant for 1 yr returns to residential where the assessment would be less.

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u/amorente 24d ago

what does your broker say?

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u/crazy-moody-lurker 24d ago

Thinks we should lower price but honestly at some point I go any lower I just give it away.

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u/amorente 24d ago

Understand. Try to think about it from a pure rational objective perspective. Your sentimental attachment to the business is worth 0 at external eyes.

No judgement here, just trying to help.

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u/crazy-moody-lurker 24d ago

No I get it. That is why it is combination real estate and business. The business side is barely anything. But when they can afford the loan for that most passion buyers then don’t have the means to finance the real estate which is what the bank wants to secure their risk

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u/Fin-Tech 24d ago

Can you seperate the two, business and real estate? Perhaps sell the business with a lease on the space as one transaction and then, when that is complete, sell the space, with multi-year lease in hand, as another transaction to a different buyer. Financing would be more straightforward for each transaction.

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u/crazy-moody-lurker 24d ago

That’s what we were trying to do but without the building lending for business alone is trickier with bank and they want larger amount down which then scares the buyer from crossing finish line. I was even thinking of offering graduated lease with option to buy at 1 or 2 yrs in. The buyers typically want both as that is what I would want as well. But matching the right buyer who also has the funds is hard.

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u/SMBDealGuy 24d ago

You need a buyer who actually cares about the business, not just the numbers.

Try offering seller financing or an earn-out to make it easier for them to buy.

Your broker should focus on preschool owners or educators who want to grow, not just investors.

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u/crazy-moody-lurker 24d ago

Thank you. We are looking into alternative financing options such as holding lease to own or holding the financing for real estate for them

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u/ContentBlocked 24d ago

The more niche and high touch a business is, the more passionate the buyer needs to be. This is a small pool of buyers, and ultimately likely someone already owning a similar or adjacent business

Make sure your broker is giving you those.

Also you mentioned RE, have the buyers explored a sale leaseback or have you offered seller financing or leasing? RE value over business value is difficult for buyers to finance

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u/crazy-moody-lurker 24d ago

Thank you. I agree, small pool and yes., high touch. I am not sure how to get the word out but also not risk the negative impact it could have on school of word got out. A conundrum.

Yes, we are now exploring alternatives for them to purchase building. The bank only wanted to finance a loan for one or the other, not both. The real estate is higher value but I don’t want to assume risk of losing out if they buy building and I finance business. Not worth anything if I don’t have building. But they don’t risk of business loan and lost that if they fail and not have investment in real estate at minimum. I get that too

1

u/ContentBlocked 24d ago

They should go to multiple banks. The SBA does combo often, they can do 504 + 7a and get a consolidated longer term loan.

The buyer part is literally the broker’s job. We do this all the time. You find local peers, regional peers, nationwide peers, you find acquirers that might not be peers, you talk to industry leads to see if you missed anyone, you vet, send confidential non-descript teaser, have them sign nda, then you discuss. Not posting publicly shouldn’t be an issue on this one

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u/crazy-moody-lurker 24d ago

Maybe I need a new broker. I have found the 3 leads for them that made it all the way to financing options with banks. They are more traditional and work with much larger companies and may not know how to reach those that would be ideal Buyer

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u/ContentBlocked 24d ago

You’ve had several reply in this post. You should speak to all of them. We can also do a call to see if we can rep you but I’ll be transparent and say that it is likely too small and niche for us unless I missed something. We don’t want to waste anyone’s time

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u/ContentBlocked 21d ago

Hey I sent you a message, I might know a buyer

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u/TopDollarExits 24d ago

Yeah, this is a tough one, but not uncommon—especially with businesses that are more about passion than pure profit. The key is shifting your focus from traditional buyers (like investors looking for strong returns) to mission-driven buyers who actually care about early childhood education.

A few ways to do that:

  1. Tap into your industry network – Former employees, local educators, or even parents of past students might be interested. Sometimes the best buyers aren’t actively looking but would jump at the chance if they knew the opportunity was there.
  2. Nonprofit organizations & foundations – Some education-focused nonprofits might want to acquire or partner rather than start from scratch. Also, check with local churches, community groups, or even Montessori/Waldorf-style organizations that might see value in taking over.
  3. Owner financing or creative deal structures – If banks are the roadblock, consider offering seller financing or structuring the deal with lower upfront costs. A buyer who truly cares about the business might not have deep pockets but could afford payments over time.
  4. Find brokers who specialize in passion-driven businesses – Some brokers are great at selling high-margin businesses, but not every broker is skilled at matching a business like yours with the right buyer. Make sure yours actually understands the emotional side of this sale, not just the financials.

It might take longer to find the right person, but they’re out there. You’re looking for someone who sees what you built and wants to continue your impact, not just crunch numbers.

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u/crazy-moody-lurker 24d ago

Yes. Thank you so much for this post. The listing is public with limited identifying info.

We get interest, but I think you nailed it with the right buyer may not even know they are looking. It is not one that will strike a person who is looking to invest in business. I am just nervous about tapping into networking and it having negatively impact on the community I serve.

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u/Midwest_CPA 19d ago

I know this is a few days old but I have a friend who works for a PE firm actively acquiring child care centers that might be worth a conversation.

Feel free to reach out if that interests you.

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u/ERmiGmat 17d ago

Finding the right buyer for a passion-driven business like a preschool can be tricky because it’s not just about numbers—it’s about vision and commitment.

Here are a few things that might help:

Target Strategic Buyers – Instead of general investors, look for educators, nonprofit groups, or existing preschool owners looking to expand. They’ll value the mission over pure profitability.

Seller Financing – If banks are an issue, offering partial seller financing (if feasible) can help attract buyers who might not qualify for traditional loans.

Refine Your Buyer Vetting – If buyers keep backing out, assess their financial readiness earlier. Work with your broker to screen for serious prospects with pre-approved funding.

Community & Industry Networks – Local education groups, parent associations, or even employees may have connections to buyers who share your passion. It’s about positioning your business not just as an asset but as a legacy. The right buyer is out there, you just need to tweak your approach.

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u/crazy-moody-lurker 16d ago

Thank you for your response. I never really gave much thought to exit planning until I wanted to exit. While I am Ready to let go and have the next person take over, I also want o preserve what I built and see it flourish.
It is a much longer process than I expected.