Holding Period Data

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In a recent poll of 921 small business owners in the U.S. by management consulting firm George S. May International, 43 percent said they planned to sell their businesses within the next 10 years, 22 percent said they plan to sell later than 10 years, and 35 percent said they don’t plan on ever selling their businesses. We know that shareholders of closely held stock have long holding periods but there have been few studies that looked at this issue. Now we have some empirical evidence that over half of closely held company shareholders have holding periods of ten years or more.

The study also showed that 58 percent of respondents have not had a formal business valuation within the last year and do not plan on having one done in the future. Forty-one percent of respondents said they thought a valuation should only be conducted upon the sale of the business, while 30 percent said one should be done every three years, and 29 percent felt that one should be conducted once a year.


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