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.
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.
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.
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.
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.