Do I have to choose between selling to a stranger and passing the business to my kids right away?

No, and treating it as an immediate either-or choice is usually the wrong way to approach it. You can explore both paths in parallel — having honest conversations with your children about their actual interest and readiness while also getting a realistic sense of what a third-party sale would look like — before committing to either one. Many owners assume family succession is the default and only turn to a sale once it's clearly failed, but starting both conversations earlier tends to produce a better decision than defaulting into one.

The nuance that trips people up is confusing a child's willingness to take over with their actual readiness to run the business, or their genuine desire to. A successor who takes over out of obligation rather than interest, without the skills or support to succeed, can put both the business and family relationships at risk — arguably a worse outcome than a well-structured sale to an outside buyer.

If you're genuinely weighing both, it's worth having a business lawyer help you think through what each path would actually require — a properly documented succession plan and share transfer on one side, a full sale process on the other — so the decision is based on what's realistic, not just what feels expected.