When to Sell Your Business: Why Taking the Offer Usually Beats Rolling the Dice

A business valued at $2 million receives an offer of $10 million, and the owner says no. Here’s what history says about knocking back offers, and how to know when to sell your business.

Imagine your business is valued at $2 million. You list it for sale. Then a buyer appears and offers you $10 million. Would you take it?

Most people would say yes before the sentence finished. Yet one business owner is currently saying no, and his story opens up one of the hardest questions in business: when to sell your business, and when to hold on.

In this episode of the [Meaning Business Podcast]([YOUTUBE LINK]), Peter and Bruce dig into that exact scenario, work through a long list of companies that rejected life-changing offers, and land on a clear position about taking profit off the table. If you own a business, or ever plan to sell one, this one is worth your time.

The $2 Million Business That Turned Down $10 Million

Bruce brought the story to the table. A client listed their business for sale at $2 million. It was valued at $2 million, and at the time the owner was happy to take $2 million.

Since then, circumstances have changed. Revenue and profit have gone up a fair bit, and the business is running at capacity. Then a strategic buyer appeared: a one-off overseas company that can see strategic value others cannot. That buyer has offered $10 million.

The owner does not want to take it.

Keep in mind the context. The business sits in a sector that is not in demand and is hard to sell. Not every buyer is going to offer $10 million for it. The owner started the business himself, so his initial investment was effectively zero, with perhaps less than $200,000 or $300,000 spent on capital along the way. As Bruce put it, it’s really hard to understand why he doesn’t happily take that deal and move on.

Why Do Business Owners Reject Big Offers?

Business owners often reject big offers because they don’t know how high is high. Many owners just want to keep going and going to find out where the limit is, and once a business is worth five times more than it was, it feels like it can keep improving.

There’s more going on underneath. Peter and Bruce unpacked a few of the drivers:

The “what next” problem. If I take that money, what am I going to do with it? Where am I going to find something that gives me the same profit and income for the amount of effort and investment I have in this? That question keeps a lot of owners at the table.

The bigger number. Once a $10 million offer lands out of the blue, the mind starts wondering: could I get 20, or 30, or 50, or 100? To some degree, every business owner thinks this way.

Changed motivation. This particular owner was very entrepreneurial, very gregarious, running at a hundred miles an hour, and initially felt it was time to move on to new opportunities. Then the business improved, the offer arrived, and the exit conversation quietly turned into a “let’s wait another four years” conversation.

Peter and Bruce see this pattern with clients too. An owner starts an engagement saying “get me to this point and then we’ll look at an exit”. The business improves, and suddenly the talk is about expansion, not exit. Sometimes that’s worth supporting. Other times the honest answer is harder: the current leadership has hit its ceiling, and the business needs professional managers to reach the next level. Owners who accept that can genuinely build more value. Owners who won’t are usually headed the other direction.

What Happens to Companies That Reject Acquisition Offers?

History is full of companies that rejected acquisition offers and lived to regret it. On the podcast, Bruce rattled off a list of businesses that have come and gone or fallen a long way from their peak: Groupon, Yahoo, Sega, Atari, Gap, Taco Bell (which has come and gone in Australia), MySpace, Kodak, Fuji, Skype, Blockbuster, Toys R Us, GoPro, Crazy John’s, Spirit Airlines in America, and LIV Golf as one of the more recent examples. Even motorcycle dealerships made the list, including a once-big Harley-Davidson dealership, because people aren’t buying as many new motorbikes and there are so many used bikes on the market.

Then come the rejected offers themselves. The numbers discussed in the episode are staggering:

Groupon. Offered $6 billion by Google in 2010. They said no, IPOed strongly, then collapsed. The market cap now sits under US $1 billion.

Yahoo. Offered about $44.6 billion in 2008. It later sold to Verizon for $4.8 billion. Roughly a tenth of the original offer.

Friendster. Google offered around $30 million in 2003. Friendster then lost the race to MySpace and Facebook, and we all know what happened to MySpace after that.

Digg. Offered $200 million in 2008. It later sold to BetterWorks for about $500,000.

Blockbuster. This one is the classic. Blockbuster passed on a roughly $50 million deal with Netflix, then collapsed. Now which one is the household brand? Netflix.

Why couldn’t Blockbuster simply do what Netflix did? The hosts’ honest answer: probably internal stagnation, the same reason Nokia never became the iPhone. Companies convince themselves they know what’s happening, make bad assumptions, and roll the dice in the wrong direction. Blockbuster could have easily become a digital channel. It didn’t.

How different would Groupon’s world be if they had taken that $6 billion?

The Psychology: Why Owners Overestimate Their Odds

The core problem is human psychology. Most people don’t understand chance and probability, so they tend to be over-optimistic about the likelihood of a good outcome. You see the extreme version in chronic gambling, where people believe the next roll of the dice will be the one, even though the mathematics doesn’t align with their perception.

Business owners apply the same false confidence. They’re hoping. And as the hosts put it plainly: luck is not a strategy.

Overconfidence makes it worse. Everyone believes their baby is the prettiest. But how do you know when your confidence in the business is justified, and when it’s just attachment? Bruce has seen too many entrepreneurs who cannot let go, who want to take the business to the point of breaking. And on the other hand, he’s seen people cash out, take the money, and end up with the best outcome they could have hoped for.

There’s an external dimension too. Politicians make decisions, wars start, fuel prices rise, everything goes up, and suddenly your business is impacted through no fault of your own. That’s when owners find themselves saying “I should have taken that offer a year or two ago”.

When Rejecting an Offer Pays Off

To be fair, it works both ways. The episode also covered a second list: companies that rejected offers and won.

Facebook. Zuckerberg fielded multiple acquisition approaches over the years, including a reported approach from Microsoft at around $15 billion. Meta is now worth roughly $1.63 trillion, one of the wealthiest companies on the planet.

Twitter. Offered around $500 million in 2008. Sold to Musk in 2022 for $44 billion.

Dropbox. Received a small offer from Apple in 2009 and is now worth about $6.2 billion. Although, as both hosts admitted, if they were Dropbox they would have taken Apple’s offer.

Google. The most interesting one. Page and Brin actually tried to sell Google to Excite for under US $1 million. Excite said no. Google is now worth $4.6 trillion.

Notice the twist in the Google story. They tried to take the money. They wanted out and couldn’t sell, so they kept going, and lady luck smiled on them. Sometimes founders genuinely know they’re holding something special and refuse to sell, and they’re right. Other times they try to exit, fail, and stumble into greatness.

But how do you know which one you are? Well, you don’t. That’s exactly the point.

How Do You Know When to Sell Your Business?

You know when to sell your business by understanding why you’re selling, what you need the funds for, and what you plan to do with them. If an offer delivers more than your plan requires, you’re generally better off taking it than rolling the dice on getting more later.

That was the practical anchor of the whole episode. If you planned to sell for $2 million and someone offers $10 million, that offer already does far more than everything you wanted. From there, holding out is close to a coin flip: you might get that or more, or you might get less. And if you miss out on millions, you will almost certainly be kicking yourself.

A few more lessons from the episode sharpen the decision:

Don’t overdeal the deal. The hosts shared a first-hand example from the recruitment industry. Years ago, a medical recruitment agency they were involved in tried to sell while there were problems in the business, and got into discussions with another agency. The mistake was wheeling and dealing too hard. By the time they were finally ready to say yes, circumstances in the industry had changed and the other party pulled the pin. The buyer left a final offer on the table, and it was rejected as not good enough. Six months later, with the business gone, the reflection was simple: should have taken that offer.

Leave something on the table. From a real estate investment group came a philosophy worth borrowing: make money on the deal, but don’t get so stuck on squeezing every single cent that the deal falls apart. Leave something on the table for the next person, because you never know when the opportunity comes again. The same applies to share trading.

Go out on a high. Business is a bit like being an elite athlete. You can’t play forever, and you’re better to go out on a high, knowing when that moment is, than to keep pushing past your peak.

Selling isn’t always goodbye. Sometimes you can sell, keep an eye on the business, and if it flounders under new management, go back in, buy it for a fraction of the price, build it up again and resell it. Not everyone can run a business to your ability, and that can become your second opportunity.

If you’re weighing up an exit, this is exactly the kind of decision worth working through with an advisor. Benchmark’s Sale Ready and Value Building programmes exist to help owners answer the “why, when and how much” questions before an offer forces the issue.

Taking the Profit Is How You Build Generational Wealth

There’s a bigger idea behind “take the money”: cashing out is how wealth compounds across a lifetime, and across generations.

Bruce framed it through inheritance. When wealth gets passed down, the next generation takes that capital, compounds it, puts it into property and other investments, and passes down even more. Selling a business works the same way. You cash out, you get the money, and then you take that money and do something else with it. It’s your own version of an inheritance.

The hosts made the same point with a property deal from a few years back. They bought a property, sold it, and made money on it. Not an incredible amount, but money. Then COVID hit, and within about 12 months that property had more than doubled in value. The response wasn’t “woe is me”. It was: what can I learn from it? The money from that sale was used elsewhere, on other properties that could then be flipped. Taking the profit didn’t end the journey. It funded the next one.

Even luck itself argues for taking the win when it arrives. The episode referenced a book on entrepreneurship (the hosts couldn’t recall the title and promised to share it in the comments) in which a researcher analysed figures like Bill Gates and Steve Jobs. They happened to be born in a similar era, in a part of America with a university that had the latest computers, in courses that gave them access to that technology. Take the same intelligence and capability and drop it somewhere without that access, and the story changes. If you’re fortunate enough to have a $10 million offer land in your lap, that is lady luck at work, and you don’t know what she brings next.

As the hosts put it, you don’t go broke taking a profit. You can always go away, regroup, and start again. That’s the message: when you’re deciding when to sell your business, you’re generally better off taking the profit in front of you, even if it’s less than you think you could eventually get, than rolling the dice and hoping probability goes your way.

Have regrets about selling? Don’t. As Peter and Bruce landed it: no regrets if you sell. You could regret it if you don’t.

Key Takeaways for SME Owners

You don’t go broke taking a profit. Generally, you’re better off taking the money in front of you than rolling the dice and hoping probability goes your way.
Know why you’re selling before an offer arrives. If you understand what you need the funds for, you’re far less likely to be jaded by the possibility of a bigger number later.
History punishes greed more often than it rewards it. Groupon, Yahoo, Friendster, Digg and Blockbuster all knocked back offers worth many multiples of what they later became.
Luck is not a strategy. Humans are over-optimistic about probability, and holding out for more is closer to a coin flip than a plan.
Don’t overdeal the deal. Push a negotiation too far and the buyer can pull the pin entirely. Leave something on the table for the next person.
Go out on a high. Like an elite athlete, it’s better to exit at your peak than to push past it and fade.
Cashing out funds the next chapter. Selling is your own inheritance: capital you can compound into the next business, property or investment.

Frequently Asked Questions

Should I sell my business if I get an offer well above my valuation?

Generally, yes. If an offer is well above your valuation and delivers more than you planned for, you’re usually better off taking the profit than rolling the dice on getting more later. Holding out is close to 50/50: you might get more, or you might get less, and if you miss out on millions you’ll likely regret it.

Why do business owners refuse good offers to buy their business?

Business owners often refuse good offers because they don’t know how high is high, and once a big number appears they wonder if 20, 30 or 50 million could come next. They also worry about what they’d do with the money and whether anything else could match the profit and income relative to their effort and investment.

Which companies rejected acquisition offers and regretted it?

Groupon turned down $6 billion from Google in 2010 and is now worth under US $1 billion. Yahoo was offered about $44.6 billion in 2008 and later sold to Verizon for $4.8 billion. Digg turned down $200 million and later sold for about $500,000, and Blockbuster passed on a roughly $50 million deal with Netflix before collapsing.

Is it ever right to reject an offer for your business?

Sometimes. Facebook, Twitter and Dropbox all rejected offers and went on to be worth far more, and Google actually tried to sell for under US $1 million, failed, and kept building. The problem is you can’t know in advance which side of that line you’re on, which is why the safer play is usually to take the profit, regroup, and go again.

How do I know when to sell my business?

Start with why you’re selling, what you need the funds for, and what you’ll do with them. If an offer exceeds that plan, take it seriously, because external events like wars and rising costs can hit your business through no fault of your own. Business is like elite sport: you’re better to go out on a high than to push past your peak.

You built the business. You took the risk. When the reward shows up at your door, don’t confuse holding on with winning. Take the profit, regroup, and go again, because you don’t go broke taking a profit, but plenty have gone broke waiting for a bigger one.