Reaping the rewards of an MBO

For many managers, an MBO is their first venture as an entrepreneur. It takes courage to leave the relative security and comfort of a salaried management position.

However, most MBO team members find the personal satisfaction of controlling their own destiny is a massive reward.

Once you’ve bought your company, different difficulties and challenges will undoubtedly present themselves. You know the business, but the dynamic will change. Here are some of the key issues and challenges MBO teams need to address.

Understand your financial partners

Each of your sources of finance has unique rules of engagement. For example, private equity partners are very different from your bankers. Understand what each of your financial partners will and won’t do.

Have a trusted team of advisers

I would say this wouldn’t I? But a management buyout brings significant change, so it is important to pick advisers who you can really trust.

Appreciate you are in it for the long haul

You may have taken on a significant amount of debt to finance your management buyout and it is likely your financial partners will expect to be paid out before you see any money.

Don’t shirk the tough decisions

Once you’ve completed your MBO, your fate – to a large degree – is in your own hands. You may now be faced with difficult decisions that need to be made in order to successfully grow your business.

Put together a shareholders agreement

A well drafted shareholders agreement addresses issues you may not have considered, such as what happens if someone gets sick, dies, is dismissed (with or without cause), and what are the issues going forward that require majority consent from the shareholders.

Enjoyed this? Read more from Nick Hodgson, Forbes Solicitors

Latest news

1

Kerakoll UK and Barnfield Construction sign contract to build new Preston plant Barnfield team on new Kerakoll site

Kerakoll UK and Barnfield Construction sign contract to build new Preston plant

27 Jun 2025

2

Scout Moor II meteorological mast gets the green light Cubico

Scout Moor II meteorological mast gets the green light

26 Jun 2025

3

Breck acquires 21-acre Ravenhead Brickworks site for 300 new homes Ravenhead

Breck acquires 21-acre Ravenhead Brickworks site for 300 new homes

26 Jun 2025

4

Conlon marks Employee Ownership Day with family fun celebration, ushering in a new era after 60 years in business Conlon celebrating its first EOT Day with family at Ribby Hall Village

Conlon marks Employee Ownership Day with family fun celebration, ushering in a new era after 60 years in business

26 Jun 2025

5

Lancashire Skills & Employment Hub announces Skills Bootcamps partnership with Northcoders Northcoders skills support

Lancashire Skills & Employment Hub announces Skills Bootcamps partnership with Northcoders

26 Jun 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
LBV123 July/August Launch Event
Lancashire Business View magazine launch
Networking
16 Jul 2025

LBV123 July/August Launch Event

Burnley

08:30 - 10:30

Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

Business Bike Club – July
Chamber Logo1.png.png
LBV Hub Networking
01 Jul 2025 - 01 Jul 2025

Business Bike Club – July

Various, Lancaster, LA

08:00 - 09:30

Chamber Breakfast Networking – July
Chamber Logo1.png.png
LBV Hub Networking
02 Jul 2025 - 02 Jul 2025

Chamber Breakfast Networking – July

St John's Hospice, Slyne Road, Lancaster, LA2 6ST

08:00 - 10:00

The Marketing Metrics that Matter – July 4
LBV Hub Seminars
04 Jul 2025 - 04 Jul 2025

The Marketing Metrics that Matter – July 4

Door4 Office, Burnley Wharf, Burnley, BB11 1JG

08:30 - 11:00

Chamber Summer BBQ
LBV Hub Social
17 Jul 2025 - 17 Jul 2025

Chamber Summer BBQ

The Borough, Dalton Square, Lancaster, LA1 1PP

17:30 - 20:00

Preston Tech Connection: Web3 is Dead. Or is It?
July Longer Banner.jpg.jpg
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Web3 is Dead. Or is It?

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Cumbria Business Expo 2025
https---cdn.evbuc.com-images-880461633-4862066883-1-original.20241022-110415.jpeg.jpg
LBV Hub Exhibitions
19 Sep 2025 - 19 Sep 2025

Cumbria Business Expo 2025

Carlisle Racecourse, Carlisle, CA2 4TS

09:00 - 15:00

North West Business Expo 2025
https---cdn.evbuc.com-images-880456273-4862066883-1-original.20241022-105445.jpeg.jpg
LBV Hub Exhibitions
24 Oct 2025 - 24 Oct 2025

North West Business Expo 2025

Bolton Stadium Hotel, Bolton, BL6 6SF

09:00 - 15:00

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV122 Online Graphic
Subscribe now

Weekly news bulletin