Generally Codiligent believes that business owners who engage a quality business broker or investment banker to help them market their business and locate, screen, and negotiate a sale to a financially qualified outside buyer will do far better financially and with less risk, even after paying a business broker's commission, than selling to an insider.
Some business owners pursue a sale to a key employee out of loyalty to that person who has contributed to their success, and would feel guilty if that key employee was laid off or their wages were reduced by a buyer. While business buyers all have different motivations and plans, more often than not they will want to retain key employees and will not want to risk losing key staff by changing their compensation structure.
Following is wise advice from Benjamin Graham, Warren Buffett's mentor and the author of “The Intelligent Investor”:
“Do not let anyone else run your business, unless (1) you can supervise his performance with adequate care and comprehension or (2) you have unusually strong reasons for placing implicit confidence in his integrity and ability. For the investor this rule should determine the conditions under which he will permit someone else to decide what is done with his money.”