Buying an existing company is one way to become your own boss and offers advantages to starting from scratch. The Business Transfer team of the House of Entrepreneurship powered by the Chamber of Commerce guides entrepreneurs throughout the successive stages of the process. Cécile Bemelmans-Mérenne, Senior Entrepreneurship Project Advisor at the House of Entrepreneurship and part of the business transfer team, explains.
How has your work evolved since the business transfer service was first established?
Since the beginning of the business transfer service a lot has changed making the option of selling or taking over an existing business a lot more interesting for entrepreneurs. In 2018, we organised the very first conferences on business transfer in Luxembourg supported by our colleagues from Europe and Canada.
In 2021, the House of Entrepreneurship of the Chamber of Commerce in partnership with the chamber of crafts and the ministry of the economy launched a national platform bringing together all the offers of transfer and takeover of companies established in Luxembourg in all sectors combined. The platform offers assistance throughout the different steps, a matching service, and the possibility of posting or viewing announcements.
How would you describe the majority of transfer contacts that you receive?
I would say that there are two types of people we are in touch with. In general, we interact with people buying shares and people selling shares (and intermediaries). Most of our contacts, around 80%, are however people selling shares as they are retiring from a business for instance.
On average, how long does it take to establish a successful match and business transfer?
In general, the process from matching to transferring the business lasts between six months and two years. Nevertheless, we have some exceptions as the timeline usually varies between the sectors of activity. In the past year, we had more than 500 interactions and made more than 100 matches through the platform.
“People looking to transfer or sell a business need to be aware of experiences their peers might have made.”
Cécile Bemelmans-Mérenne
What tend to be the pain points for matching a buyer and seller?
We often have people wanting to sell their business and not finding a buyer for it. I would describe this as one of the pain points when it comes to business transfer. Another issue we often face is the price being asked. The seller really needs to focus on the added value the transfer provides the buyer with.
To what extent have tech startups reached out to your team regarding business transfer opportunities?
To be honest, we do not yet have a lot of tech startups reaching out to us. The main contacts we are in touch with are generally from the commercial, service or craft sector. The number of tech startups is rising in Luxembourg and as a result we are more likely to have further exchanges with a great number of tech companies in the near future.
The main problems we face with tech companies is the evaluation based on their future earnings, which are often uncertain for these companies as they are quite young. The evaluation being a critical part of the business transfer, a lot of tech startups do not yet think about these new opportunities.
To what extent do you think it’s possible there will be a demand for this service from the tech startup ecosystem in future?
A lot of companies are aspiring to make business in Luxembourg, including tech companies. Taking over an existing business in Luxembourg would therefore be an interesting option with often underestimated advantages. The demand for the business transfer service will certainly grow in sectors where we do not yet have a lot of activity, as the European Commission believes that it is just as important to point out the support of transfers of startups as the creation of new companies.
What is the strategy for the business transfer website in future?
We are currently planning a few changes that will be made to the business transfer platform. Being a national platform for business transfer, we would like to broaden the information provided through interviews and success stories. People looking to transfer or sell a business need to be aware of experiences their peers might have made.
We definitely would like to raise awareness for better planning and preparation of the business transfer. All in all, the most important thing for us is to be present for entrepreneurs wanting to transfer their business and provide them with as much information and support as possible throughout the process.
