Take over instead of starting up: What you have from day one.

If you start a business, you start with an idea. If you take one over, you start with a company. It sounds like a small difference, but it changes almost everything: what you focus on in the first few months, what risks you carry and how you measure success.

According to KfW (Germany's state development bank), around 545,000 German Mittelstand (small and mid-sized companies) will be looking for a successor by the end of 2029. For many people who want to work entrepreneurially, this is an opportunity that few have on their radar. Sometimes the best startup is already 40 years old.

Startup vs. takeover.

• Customers: In a startup, you look for them. With a takeover, they are already paying.
• Team: In a startup, you hire it piece by piece. With a takeover, the team already knows its trade.
• Cash flow: In a startup, you burn money until it becomes self-sustaining. With a takeover, it flows from day one.
• Product: In a startup, you search for product-market fit. An existing business has proven it over years.
• Risk: In a startup, the business model is uncertain. With a takeover, the risk lies more in the price, financing and transition.

You can find more comparisons in the Startup vs. business section on our home page.

What is already there.

A running business comes with things that cannot be built in weeks: customers who trust you, suppliers with favourable terms, processes that work and a local reputation. This is your starting capital, even if it does not appear on any balance sheet.

What you bring.

You bring the next step. Digitalisation, new markets, better processes, new products. Many things learned in startups can help a business that has been working the same way for years. AI can also help make quotes, planning and administration more efficient without replacing the craft.

You do not have to come from the industry. An entrepreneurial mindset, leadership experience and a willingness to understand before you change are more important.

Paths to a takeover.

• Management buy-in (MBI): You come from outside and take over. According to KfW, handover to an external party is one of the most common routes, accounting for around 28 per cent.
• Management buy-out (MBO): Managers from within the company take over, accounting for around 24 per cent according to KfW.
• Gradual entry: first management, then shares. This gives both sides time.

A realistic look at financing.

According to KfW, the average purchase price for SMEs is around 499,000 euros, with the median at 0.6 times the annual turnover. The range is wide. A mix of equity, bank loans, support programmes and sometimes a vendor loan, where the previous owners defer part of the payment, is common. You should always consult tax, legal and financial experts for grants and contracts.

What to look out for.

• Dependencies: Does a lot of turnover depend on a few customers or on the owner's personality?
• Figures: Annual financial statements, contracts, investment backlog. Check carefully before you sign.
• Team: Who are the key people, and will they stay?
• Transition: How long will the previous owner stay on board, and in what role?

The company does not belong to you alone. It also belongs to the people who built it. In the first few weeks, listen more than you change. Trust within the team is worth more than any quick restructuring.

The first 100 days.

• Speak to each person on the team individually.
• Visit the most important customers together with the previous owner.
• Understand the figures and processes before you change them.
• Implement one or two visible, small improvements that help the team.

How Nachfounder supports you.

Nachfounder prepares you for the takeover, connects you with suitable businesses and supports you along the path in stages: getting to know each other, due diligence, handover and the time after. We are not M&A consultants. We turn successors into founders.

Want to take over a business? Take the Succession check for an initial assessment or write to us about what you are looking for: industry, region, size. For background information on the market, see our post on The succession gap.