Throughout my career, I’ve been involved in post-money growth, representing a public company to the board of directors, integrating post-deal acquisitions, and being at the due diligence table.?
Here’s 7 easy steps to consider as you think through a potential change in control as a private business serving a B2B market:
- Get your financials in order: Before discussing a sale, it's important to have accurate and up-to-date financial records that demonstrate the health and performance of your business. This includes financial statements, tax returns, and any other relevant financial documents.
- Develop a clear growth strategy: Potential buyers will want to see that your business has a clear plan for growth and expansion. Having a detailed strategy in place will give them confidence in the future prospects of your business.
- Identify and address any potential issues: Before discussing a sale, it's important to identify and address any potential issues that could arise during the process. This could include legal or regulatory compliance, intellectual property, or any other potential roadblocks.
- Build a strong team: Having a strong team in place is essential for any business. This includes not only your employees but also a professional and experienced management team that can continue to run the business after the sale.
- Prepare your marketing and sales materials: Having a well-developed marketing and sales strategy is important to demonstrate the value of your business. This includes a clear value proposition, marketing materials, and customer testimonials that can demonstrate the business's value to potential buyers.
- Understand the market: Understanding the market and industry trends is crucial before discussing a sale. Knowing the competitive landscape, the potential buyers and their preference, and the market trends can help you to have better negotiation power.
- Get professional advice: Before discussing a sale, it's important to work with professionals such as lawyers, accountants, and business brokers who can help you navigate the process and ensure that you get the best possible outcome. If you have someone within your organization that can serve in this role, great; Otherwise, underinvesting to maximize your investment isn't a way to swim amongst sharks.
By doing these things, private business owners can better prepare for a complete or partial sale of their business and increase the chances of a successful outcome. If they are asking for things you don’t have during due diligence, it’s probably too late to get started, so be proactive; vitamins and exercise prevent surgery and medicine for your business.?
