Ask HN: When you sell your company, do you receive the money with a normal wire? | Hacker News Reader

Ask HN: When you sell your company, do you receive the money with a normal wire?

6 pointssupergilbert8 comments

For those who sold their company for a substantial amount, did the money just arrive on your "regular" bank account?

Did you arrive in several times?

Don't laugh, I'm trying to visualize the moment my startup is sold, and I want simple details like this one.

Thank you for sharing your experience

We sold a company last year, and the deal was structured for 80% after the asset migration, and then 5% quarterly for 4 quarters to ensure we don't disappear. So it was 5 payments, but effectively the first one was one big transfer into the bank account. The money first went from the buyer to an escrow service before the migration started, and they released it to us when the migration was complete. The escrow service was very picky about which banks they wanted or did not want to work with, and they refused to send money to our Wise account which would have saved a lot of money in transfer fees and forex later. Sending to a traditional bank was fine.

I think traditional banks are a safeguard against money laundering (as in WE did the right thing).

yes it did, and oddly enough having the choice of that escrow reduced our legal costs. Our lawyers wanted to perform AML research to ensure we were compliant (or I guess that they are compliant) but the fact that the deal used a reputable escrow allowed them to just tick that box without charging us an arm and a leg.

There is a briefcase on the corner of Market and O’Farrell.

You will see a homeless man. Approach him. This is Rufus - your detail.

When no one’s looking, open the briefcase to find two loaded fully automated weapons and some climbing equipment.

Rufus will show you the way to the old Twitter building a few blocks away. Take a Yellow Cab, use their awful app, it’s the only way to go untraced because there’s so many bugs even their tracking scripts don’t work.

Jack Dorsey will meet you at the door. Most don’t know but he still runs things. Behind the scenes.

Follow Jack into the elevator where he will take you up to the Andreessen Terrace. Pay no mind to the cone headed monks there, they spend most of their days writing manifestos and practicing breathing through the nose.

Arrive at the top floor. Tom from MySpace will hand you the cold hard cash. He’ll tell you fantastic stories of his travels around the world and you’ll share some nice Oolong Tea.

And that’s it - we like to move pretty fast around here.

Yes it's a giant wire payment. Depending on your bank, it might have to be setup to send in daily large amounts (e.g. $999k every day for X days). It can actually cause problems for your local bank branch because one thing banks have to do at the regional level is show that their own local balance sheet is healthy. So a giant deposit moving in and out of the bank can cause compliance issues.

Shouldn't you instead envision large payments hitting the business account and a yearly dividend first?

That will happen before you sell the company.

Or envision doing great work and having satisfied customers and a great product and a well run company with satisfied productive staff.

My advice is to hire lawyers familiar with handling similar transactions and to follow their advice. Because what you imagine is not based on substantial experience and the matter is complex in ways you can't imagine. Good luck.

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