Opportunity of a lifetime or not?

Hello everyone, I have posted here before but not for some time now. I have come to Ferrarichat to post the following because of the experience and good feedback that I have received in the past. As the title states, I have been bestowed a great opportunity or possibly not!
I had approached a long time business owner of a small (close to medium) sized company about my interest to buy his business. We went through the perils of the financial history, valuation etc...etc...and came to the end result he wanted more then I was willing to pay. He had in the last 6 months had a major heart attack and major surgery. I approached him after he was on his feet again about sitting down with him. To my surprise he was inclined to doing so and yesterday we met. In which I was totally astounded at when he proposed to me that he would like to have me come aboard and bring the company back to its so called "glory days". This is not to say he not doing well now, but has had to lay off because of the recent rescission and major heartattack. He offered me close to what I am paid at my current job along with a fatter commission for each sale. And after one year, the opportunity to buy into the company and proceed to obtain full ownership down the road if I should so choose to. I have worked for the company years back as a student and know a bit about the operations but do know his market as I currently sell to the same market. No particulars have yet been discussed such as how long time period to obtain full ownership and what he is looking for as far as sale of the company. But based on the fact that he is willing to stay on and still be vested is reassurance that he believes we can expand and that there is oppurtunity, we just need young talent (myself). I apologies for the long winded email but would love to gather any thoughts on what I should proceed to do here. As a note I am fairly young (early, early 30’s) so is risk more inherit at this age? Keeping in mind I have a 2 year old and mortgage etc…like anyone else.

Thank you

 

It sounds like a good opportunity. If your intention is to buy the business and his health is bad I would have "first right of refusal" written into your employment contract. So if he passes away you get to buy the company from his estate if you still want it, whether his heirs want to sell it or not. How you determine the price is up to you. Also, make sure the purchase terms are in there regardless of whether he passes or not. You don't want to turn his business around only to have him hang around for another 15 years and decide not to sell. Having him around will help you through some of the funny situations that will come up though. Good Luck.

 

How viable is this business in these economic times? Seems like it would make more sense to set realistic goals if things work out and you'd like to take it over. Otherwise you could be contributing to greater success of the company and thus increased value and he could decide to sell it to someone else. It'd be one thing if you were his son for example but you're not. Try to pin him down on what he'd be willing to sell if for, get it in writing and then go from there. The down side of that is there may be more risk on your part with him tying your compensation now to performance. If you think the opportunity is worth it the fruit is out on the limb anyway. If the deal isn't to your liking just stay put and wait him out. Good luck.