There are many mistakes we’ve seen business owners – and sometimes their advisors – make in selling their business. Here are 5 common ones:
- Trying to go it alone – someone has reached out to you on an unsolicited basis – perhaps a competitor, business associate or other source – DANGER lurks ahead. No one will offer you top dollar in a non-competitive process. In addition, selling a business is a full-time task which takes months to complete and it is not necessarily your area of expertise. Moreover, it’s critical you focus on running your business, keeping customers happy and profits solid.
- Hype and Hyperbole – beware the M&A Banker who “hypes” you with unrealistic valuation expectations and timeline or tells you they know the right buyer. Inevitably these promises fall short.
- Not running a Broad Process – you live, eat and breathe your business every day and know your customers and competitors. Potential buyers can be companies who are competitors, in adjacent markets, considering an entry into your niche, domestic or international players looking for a market leader, private equity firms aiming to buy a player in your space or add you to one of their companies, family offices with a longer term time horizon…The list of potentially interested buyers can be large.
- Thinking Bigger is Better – Boutique firms offer deep expertise – the individuals who will actually do the work need to be senior, experienced, have a wealth of transaction experience and commit to you that during your process your transaction is their main priority.
- Taking your eye off the ball and LOSING MOMENTUM in your business during the process – the outcome, if there is still a buyer, will suffer. Focusing on keeping your business running smoothly throughout the sale process is key.