Selling a business is one of the most emotional decisions a founder will ever make.

Not because of the numbers on the table — but because what’s really being transferred isn’t just ownership. It’s identity.

A PwC family business survey found that 77% of entrepreneurs see their business as an extension of themselves. I believe that’s the heart of why M&A is so complex for founders. The balance sheet may tell one story, but beneath it lives another — a story of years spent building something that reflects who you are.

When founders sell, they’re not just parting with assets. They’re sharing a legacy. 

For some, it’s family, community, writing, or a new venture. The specifics matter less than the intentionality. Without a plan, you risk making emotional decisions that stem from loss instead of vision.

A pattern I’ve seen again and again: most founders started their firms because they love clients. Over time, success pulls them away from that work. After the sale, many rediscover joy by getting back to those client conversations, mentoring young entrepreneurs, or staying active in their communities. Returning to the original “why” helps restore balance.

Step 2: Watch for sunk costs and the endowment effect

In my field, we talk a lot about cognitive biases — and two show up in nearly every deal.

• Sunk cost fallacy: the pull to make decisions based on time and effort already invested, rather than future value.

• Endowment effect: our tendency to overvalue what we own simply because it’s ours.

Founders consistently overvalue their companies by about 20–30%. Buyers aren’t immune either — after months of diligence, it’s hard to walk away. But sometimes the best outcome is a deal that doesn’t happen. A healthy process recognizes that “no” can be just as strategic as “yes.”

Step 3: Don’t mistake flattery for fit

Flattery lights up the same parts of the brain as financial reward. Neuroscience literally shows that praise feels like a bonus check. That’s why a buyer’s enthusiasm can be so powerful — and so dangerous.

You hear how exceptional your firm is, and suddenly the offer feels fated. But compliments aren’t due diligence.

Two safeguards can keep emotion in check:

• Build your process before the praise. Decide how you’ll evaluate offers — the metrics, the advisors, the criteria — before anyone shows up.

• Get an objective partner. A trusted advisor or M&A professional brings emotional distance. A good process and a good partner are better than heaps of praise.

  
  

Step 4: Don’t let the deal clock rush your decision

Scarcity is one of the strongest psychological forces we know. When a deal feels limited — a “once-in-a-lifetime” opportunity with a ticking clock — your brain goes into urgency mode.

Research shows that decisions made under time pressure are up to 25% less accurate.

Some urgency is fair. Endless offers aren’t sustainable. But beware of manufactured pressure. Selling a business is not a flash sale; it’s the handoff of your life’s work. Choose partners who respect that gravity.

The psychology of letting go

Selling a business doesn’t erase who you are — it just shifts where that identity lives.

You can be a builder without owning the building. You can lead without leading the company. What matters most is clarity: knowing what part of you continues beyond the sale, and giving yourself a framework to make every decision through that lens.

Because at the end of the day, you’re not selling a company. You’re sharing a legacy.