First Things First: Have a Meeting with Yourself!
Many business owners started their business and have worked tirelessly to make it grow into what it is today. For these business owners, selling their company is not unlike driving away after dropping their youngest child off at their chosen university. Such an event magnifies a new stage of life . . . happy, sad, proud, uncertain – you get the picture.
With that in mind, the first step we recommend is to grab a pencil and notebook, go to a quiet place where you can’t be interrupted, and ask yourself these questions.
Why Do I Want to Sell?
There are many reasons why owners decide to sell, but a few of the more common ones include: 1) monetizing and capturing some value and reallocating the rest to another venture; 2) desiring to slow down life a bit before full retirement; 3) cashing out assets for estate planning; 4) full retirement; and potentially; 5) unanticipated events.
What Kind of Buyer Am I Seeking?
Make no mistake, money is the primary reason owners sell. Some owners simply want to take the money and run. If the highest price is the only motivator, any buyer with money will do. In this case a strategic buyer may fit the bill. They will often absorb the business and reduce staff of the target company, then move on to the next opportunity.
Other owners may want to see “their” company continue as a going concern, under the same name, assuring that key personnel are protected, and that the company’s philosophical continuity is preserved, relatively speaking, as a legacy. This kind of seller requires a different kind of buyer. Often, the right private equity firm will fit this bill.
Which kind of seller are you?
What Is My Exit Strategy and Succession Plan?
There’s much more to an exit strategy, but on the surface, it identifies an individual who will manage the business daily as you leave, identifies key issues that can be roadblocks to buyers, and quantifies how much money you’ll need to maintain your lifestyle after the sale.
How Do I Want To Be Paid?
Do you want 100 percent cash at closing, or would you be willing to work through a buyout over time? Do you want to pass the business on to family members? Are there other benefits you want from the sales package?
What Do I Intend To Do With The Proceeds of the Sale?
You likely already have a wealth advisor guiding your investments and financial goals. That person can help you answer this and other important financial questions.
These answers that you penciled together are your objectives for the sale of your business. Hold firm to them throughout, unless presented with an overwhelming case for change. These “guiding tenets” will make the entire process of selling your business run more smoothly.
Our process begins with a thorough analysis of your company, the competitive environment and the market in which it operates. Tobin & Company then identifies potential market opportunities to best realize client objectives.
We develop comprehensive, acclaimed marketing materials, including an Information Memorandum and an Executive Summary, depicting the company’s strengths and investment highlights.
Identification of qualified buyers
We resourcefully create a broad list of targeted buyers through our extensive knowledge and our databases of strategic and financial acquirers worldwide.
To execute the final sale, TOBIN works closely with our client to evaluate all viable offers. We represent our client’s best interest from the initiation of negotiations, through due diligence and finally to consummation of a transaction.