Exit and Growth Strategies for Middle Market Businesses

Archive for the ‘Exit Strategies’ Category

Succession Planning Adds Value

By Terry Fick | Jul 01, 2021

Many think of Succession as a strategy if you plan to keep your company, i.e., who will run my company after I retire?

Succession is also an important element of your strategy when preparing to SELL a company.  Look at your scenario as the buyer will see it. “Who’s going to run this company after we buy it?” If you, as the owner and CEO plan to stay on as CEO or President long term, then that will work for most buyers.  However, if you want to leave upon, or soon after, the sale, you need a credible plan in place.   A strategy of “It is up to the buyer to replace me”, will probably turn many buyers away and certainly drop your value in the eyes of buyers. This strategy will significantly lower the number of buyers you may attract to buy the company and those that are willing to put their own person in place will know your options are limited and lower their offer.

A better strategy is to ask yourself,

  • Do I have a #2 that wants to and can step into my shoes?
  • Can I demonstrate that he/she is capable?
  • Can I demonstrate that the company can move forward without me?

If the answers to all are yes, then you might consider promoting that person to President as you prepare the company for sale.  If the answers are no, then a couple of options might be your Plan B:

  • Decide to stay on long enough to help the buyer find, hire and prove out a new person to lead the company. This is usually a one to two-year commitment.
  • If you have time before you go to market, you might consider looking outside the company and hire a credible leader to fill your shoes. You will need time to hire and assimilate this new “President”.

If none of the above work for you and you simply want to find a buyer that will accept a short-term commitment from you, then you need to really hone your buyer search efforts to make sure you have the right players at the table when you are considering and comparing offers.

It is always hard for an owner to see his company through the eyes of buyers (and not all buyers are alike) so listen to your Investment Banker’s thoughts and advice on this matter.

The long and short of it is that the management team you bring to the table will have a significant impact on your strategy and your value.

The Value of Middle Market Investment Bankers

By Robert St. Germain | Sep 03, 2020

During these challenging COVID-19 times, most long-tenured business owners are likely shouting, if not out loud then in their minds, “Oh no, not again!!!” as they are reminded of the Great Recession of 2008 and the many years it took for them to recover from that downturn. Today’s uncertainties may have them thinking that it is finally time to consider an exit. ?????? ?? ??????? ??????

The decision to exit from a business is very personal and generally results from answering questions like: “Do I have the energy/interest/health to continue running my business?”; “Do I have tolerance for the continued financial risk of supporting my business?”; and “Do I have a well-defined post-close life plan that I know I would enjoy as a ‘former business owner’?”.

When answering those questions leads to the decision to sell the business, the typical next question is “Should I sell my business on my own or hire an investment banker to help me do what I (likely) have never done before?”

The answer to the question of using an investment banker (IB) or not can be informed by revisiting a study titled The Value of Middle Market Investment Bankers published by Fairfield University in October 2016. The study’s purpose was to answer two basic questions of its own: a.) Do IBs add value to the business sale process?; and b.) Which IB service do business sellers value most?

The study surveyed 85 business owners who utilized IBs to sell their privately held companies or majority stakes therein for between $10M and $250M during the period 2011 to 2016. The results were quite illuminating.

To the study’s first question of whether or not IBs added value to their respective sale processes, 100% of the surveyed owners indicated their IBs did add either moderate (31%) or significant (69%) value to their processes and the achievement of successful transactions.

To the study’s second question, the owners were asked to rank by value to them eight specific services provided by their IBs. The owners ranked first and foremost the management of the complex M&A process and its associated strategy setting as the most important service of their IBs in support of their companies’ sales.

For the uninitiated, that M&A process and strategy setting typically include: a.) establishing pricing/valuation expectations; b.) crafting compelling marketing documents; c.) identifying all suitable strategic and financial potential buyers; d.) conducting the outreach campaign to those potential buyers; e.) establishing a virtual data room to house due diligence information appropriate for each stage of the process; f.) creating and maintaining competition between potential buyers to maximize shareholder value in the outcome; g.) calling for and negotiating indications of interest (IOI) to down-select to the sub-set of most viable buyers; h.) managing the post-IOI seller/buyer interface to include conference calls, management presentations and on-site visits; i.) calling for and negotiating letters of intent (LOI) to down-select to an exclusive potential buyer; j.) facilitating final due diligence during the post-LOI period; k.) assisting in the negotiation of the sale/purchase agreement and its associated documents; and l.) maintaining confidentiality throughout the entire process.

If participating in a professionally run sale process to maximize the return on your life’s work is of interest, contact your local CFA office, which is staffed with senior, securities licensed investment bankers operating in the context of a worldwide organization with over six decades experience assisting business owners sell their companies.

Who Moved My Deal? | Why Selling Your Company isn’t a DIY Project [Part 1]

By Daniel Sirvent | Apr 09, 2020

While intelligence, creativity and grit are all requisite characteristics of a future surgeon, nothing quite works like experience.

Nearly any medical school resident can handle a surgical procedure under normal circumstances; they’ve studied and memorized the procedures and the most likely risks associated with them. So why do they need an attending surgeon to supervise? Because when things don’t go according to plan, they need someone who’s “been there and done that” who can remain calm and work through the situation to re-stabilize the patient and get them to recovery.

How Business Owners Kill Their Own Deals

Why would an intelligent, creative and gritty business owner who hires a mechanic to repair their car and a plumber to fix their toilet, ever even think about trying to sell what may be their most prized and valuable financial asset all by themselves?

Simply put, they believe they understand the procedure (just find a buyer and stand your ground) and they believe they have the “right stuff” to negotiate a great deal.

Unfortunately, what they’re often lacking is the experience to handle the unexpected turns that come with the territory and often don’t realize their mistakes until it’s too late. Which could mean that at best they’ve missed an opportunity or at the worst, agreed to a deal that’s left them holding the short end of the stick.

So what are some of the most common mistakes that can derail a transaction and/or lower the transaction value in a business sale?

Time vs. Ego – What Kills More Deals?

Years ago, I had a public company CEO as a client who told me “time is the enemy of all deals.” While his intentions were well placed (he didn’t want to be the party that was dragging its feet), I gently and directly let him know that…he was completely wrong. Time is actually an asset that both parties need to protect and manage effectively, but that’s not the same as assuming that every part of the process must be fast. While poor time management carries its own risks, ego is the true enemy of all deals. When either party in a transaction fails to acknowledge the role ego plays, the entire deal is put at risk.  Read more »


By Terry Fick | Dec 19, 2019

You may have heard it called the “Auction Process” which in an of itself carries a negative connotation.  It sounds like a program to sell distressed companies or properties. It is just the opposite. This is a process conducted by professional Investment Bankers (Bankers) to deliver your value proposition to multiple prospective buyers at the same time pitting them against each other in an effort to extract the best price from the best buyer.


The key word here is “Competitive” because this competition accomplishes three things:

  1. Buyers are aware that others are interested and that they need to offer a premium price to beat out the competition.
  2. In the end, it assures you that the value of your business has been set by multiple, knowledgeable buyers.
  3. It should allow you to select your favorite buyer whether or not his offer is the highest.

Everyone would probably agree that these are all important objectives when selling a company.

This is not  an “Auction” whereby your name and information are posted somewhere with bidders in a room raising a flag to outbid the last offer until the hammer comes down. Properly conducted, your information is tightly controlled and protected, only allowing serious, capable prospects that you have approved and have signed a Non-Disclosure Agreement to have access to your identity and/or information. None of these know who the other bidders are or how high their bids may be. Properly executed, it is possible to have only one bidder, but extract a great offer from him because he doesn’t see the other horses in the race but he definitely hears the hoofbeats!

While most Investment Bankers believe there is no better way to maximize your value, there are those owners that prefer to minimize their effort and time when selling by avoiding that process and simply wait for the right buyer to come along. That can be a long wait and if that buyer comes along, he knows there is no competition and makes his offer accordingly. Sometimes this preference is based on a business owner friend’s horror tale of a “Busted” auction that did not result in a sale. You minimize that risk by making sure the information you provide is complete and accurate and hire the most professional Banker you can find.

Along these lines, let me interject a big red flag here. I am quite sure you get calls and letters from Business Brokers and some Investment Bankers touting that they represent the perfect buyer for your company.  You should first ask them to name this buyer and tell you why they are interested.  If they won’t do this and send you an NDA signed by this buyer, then politely take a pass.

Sometimes we hear “Bring me one buyer”. That approach (or something close) can result in a good transaction if properly managed. Your Investment Banker should scour the same list they might have invited to an auction for a handful that they believe would be front runners.  From this handful, they try to find the one that is definitely interested in your company.  The buyer knows you have hired a Banker to maximize your outcome, so he will assume there is competition (hearing hoofbeats) and makes an appropriate offer. Hopefully, all ends in a good transaction for you. Two things to consider if this is your preferred approach.  One is that you and your Banker must assemble the same information for this process that you do for an auction.  You simply cannot solicit a valid offer until the buyer knows what he is getting. The other is that there is a much greater risk that this one buyer does not complete the acquisition and you must start this whole process over again.

So, there are pros and cons to the Competitive Bidding process. It is hard work and takes some time and a little money. As mentioned above, there are alternatives to the Competitive Bidding process and if that is your strong preference, be sure to let prospective Investment Bankers know this when interviewing them and see how they would plan to implement your chosen process.

Why George Didn’t Accept The Highest Offer

By Dean Durbin | Nov 12, 2019

How Sometimes Less Is More When Selling A Business

Well, there we were…..after months of hard work marketing his company, reaching out to over 1,000 potential buyers, obtaining over 100 signed Confidentiality Agreements (CA’s), several dozen Indications of Interest (IOI’s) and a handful of management meetings, we, along with the owner, scoured with a fine-toothed comb through seven printed Letters of Intent (LOI’s) laying on our conference room table.

The only thing left for our client to do was to pick the LOI with the highest price and let us push this deal across the finish line so he can cash his check and retire, right? After all, who in their right mind would take less than the highest offer? But as the old football coach Lee Corso says every Saturday morning on ESPN GameDay, “Not so fast my friend!”

It’s true that some owners care only about the maximum monetary payout. However, it’s been my experience that more often than not it’s a combination of price and terms that determination which buyer to choose. Every client has different objectives and perspectives on what they want their exit, or in some cases partial exit, to look like.

The owner, let’s call him George, was approximately 65 years old accurately be described as a humble, gentle and wise human being. Fortunately for George, there were numerous quality offers ranging from $34M to a high offer of $47M.

The CFA Team constructed a decision matrix, which is just a fancy word for a table containing the pertinent data, pros, cons, and comments on a large one page chart. It was at that point, we let George lead the conversation and we primarily listened to him as he went through the offers. Within, five minutes, four of the offers were pushed to the side and that was the easy part, it was the “Final 3” that took a little more time and discussion.

Among the 3 remaining offers, there were many differences in price, terms, future objectives management teams and numerous other categories. In the end, George elected to sign an LOI with Company Y for about $6M less than the $47M offer from Company X. But why?

George is not unlike a lot of other sellers.  While I can tell you that the ultimate sales price was a factor, it absolutely was NOT the primary factor. The reason George chose Company Y’s offer was because it most closely resembled his “mental image” of his post-sell world. Although not the highest offer monetarily, I personally believe that Company Y was overall best fit after getting to know George throughout the process and it didn’t surprise me in the least.

The key decisions that drove George’s decision, in what I perceive to be order of importance were as follows:

  1. Employees were treated well – moving the factory out of state or large-scale layoffs would’ve been a deal-breaker regardless of price, yes regardless of the price. The buyer gave written assurance of the employees’ job security and actually improved some of their pay and insurance packages.
  2. Price and Terms of the payment – during negotiations, the $41M price remained constant. However, due to the competitive nature of the engagements we were able to negotiate several improvements: –
    • George’s rolled forward equity went from 15% to 19%, thus allowing George or his heirs a potentially larger “second bite of the apple”
    • The payout was all cash at closing, while the other offers were paid out over several years and structured as an “earn-out” and even some as seller notes
    • Distribution formula for George’s future equity payouts was greatly improve
  3. Management team – during the management meetings George had a wonderful connection personally with Company Y. It was obvious that they “clicked” better than the other buyers. Additionally, Company Y came to the management meetings with creative ideas, especially in the product marketing area to increase the company’s market share. It was clearly stated by George that “he felt like he could breathe easy for a change and was confident that Company Y’s team would put the company in good hands”. Confidence in the management team’s ability to continue the growth of the business was a significant factor in his decision.
  4. Opportunity to stay connected to the business – George now sits on the Board of Directors, helping to consult with operational and marketing issues from time to time. Today, he spends most of his time with his wife and family and is semi-retired, because he hates the word “retired”.

In the end, there were several items that George gave up that he didn’t even care about and very few that he did care about. He did sign a non-compete, however he’d never considered competing against his old company especially at 65 years of age. George was not interested in an earn-out. It probably cost him some money, but he was content to remove some risk in exchange for a slightly decreased payout.

The lesson we can learn from this case history (which was modified to protect client confidentiality) is that every owner is different and it’s typically a combination of factors that drive a decision, not just the final sale price.

As a final commentary, one of the things that make our job as CFA investment bankers so satisfying is to see people like George, that have taken risks, sacrificed time and worked incredibly hard to build a terrific business, get rewarded for their efforts when they end their journey as business owners.

Selling Your Business Is Not An Event… It Is A Strategic Process – Part III

By Terry Fick | Nov 15, 2018

Part III

Selling your business is not an event… It is a strategic Process.

More Conversations
Now that the prospective buyers have reviewed the information in the Data Room,

  • Be prepared to answer questions that stem from their review of the information supplied.
  • There may be another round of Q&A.
  • Ask what information he needs to be able to at least discuss a value range (IOI). DO NOT let him corner you into giving him a price!

With their NDA in place and having received his request for information for their IOI,

  • Populate the data room with the additional data requested, as long as it does not reveal truly sensitive information. You might segment the Data Room to manage the release of that data.
  • Once you have made the decision to give the buyer access to the data room. If there is a broker on their side, do not directly give him access to any of this information.
  • Answer questions about the data provided and wait for his indication of value.

Controlling the Negotiations

Assuming you get multiple indications of interest (IOI’s)in the right range, you will want to orchestrate this process so that visits by these prospects are around the same time. That should lead to getting multiple LOI’s at about the same time, so you can compare them before accepting one LOI.


  • Solicit multiple initial LOI’s before negotiating a final agreement
  • You are exclusive with one party while under LOI
  • LOI’s are mostly non-binding, but:
    • Price and Terms are obviously spelled out in detail.
    • Capital Structure to be employed
    • Your and maybe some of your management team’s roles and compensation should be addressed.
    • Structure of the transaction (stock or asset), how your debt will be eliminated, working capital, escrows
    • Timeframes, 90 days?
    • No Break Up fees!
  • Full disclosure after agreement


  • Involve your CFO very early in the process. He or she can often access and provide the information needed more efficiently than the owner.
  • Involve your other top-level managers when you start to have substantial calls or visits with potential buyers. They will be important to the buyer. Let those managers know you plan to find a deal that is good for them. Before that, you may want to consider if and how you might want to reward them when a deal closes.
  • Think one step ahead so you can be prepared to give timely responses to questions, offers, situations and obstacles.
  • Do not be afraid to identify your company’s “shortcomings or issues”. If you identify them, they are just warts, if they find them, they are cancers.

Summarizing Some Do’s and Don’ts:


  • Have an idea of what your company is worth before you even start responding.
  • Make sure you are talking to an actual buyer, not a “broker” on a fishing trip.
  • Qualify the buyer before you start giving up information.
  • Always get an NDA in place prior to giving up information.
  • Create a sense of competition even if you are only talking to one party.
  • Make sure to spend some time preparing. Get your information ready and organized.
  • It’s more than OK to brag about your business and talk about your plans for growth. That is what all buyers are interested in.


  • Never give a price or directly state the value you expect.
  • Don’t Let a broker gather information to “give to his client” unless his client directly asks you to do so.
  • Don’t give out competitively sensitive information like customer names until you are under LOI.
  • As earlier suggested, talk to multiple buyers at one time rather than one at a time sequentially.
  • Try to avoid bi-lateral NDA’s. You gain nothing by signing one.
  • Do not sign an LOI until you get legal advice. While they are non-binding for the most part, a well written LOI can save much time and aggravation down the line. It gives you the chance of previewing how a buyer will negotiate.

In Summary:

  • Take control of the process. By simply responding to all of their questions and demands, you lose that.
  • Keep thinking like the buyer. It is like selling your product or service, always determine what they want/need before you start your sales pitch.
  • I would assume this would be the largest financial transaction of your life, don’t take it lightly.
  • Remember:

  Selling your business is not an event… It is a strategic Process.

Selling Your Business Is Not An Event… It Is A Strategic Process – Part II

By Terry Fick | Nov 14, 2018

Part II


Selling your business is not an event… It is a strategic Process.

Like most successful outcomes, selling your company starts with the right preparation!

  • Set your expectations of value.
  • Prepare an NDA so it is ready at the appropriate step below.
  • Set up a virtual data room and populate it with the basic information anyone will need to see. Since you may present your information to multiple parties, this eliminates a duplication of efforts, creates an air of professionalism and gives the impression you are, or plan to, talk to more than one party. Your Attorney or Investment Banker will manage this if you prefer.
  • Look at your company through the eyes of a buyer. Ask yourself what aspects of this company would be attractive to you and what aspects would give you pause. Plan to accentuate the positives and minimize any negatives.
  • Develop a growth plan. Always sell the Future!

Now, prepare some more!

Are you ready to answer the typical questions they will ask?

  • Are your financial reports up to a buyer’s standards? If you aren’t sure what is expected, ask a professional.
  • Can you answer questions about your market position, your customer concentration, your competition (and how you stack up), which of your products are the most profitable, what are your strengths in the Marketplace, What role you want after a transaction, etc.?
  • Who would take your place if you are ready to retire?
  • Prepare a supportable projection for 3-5 years.
  • The list goes on, but a little preparation will give you a significant advantage.

Dealing with buy-side Brokers

They may or may not be credible.

  • Ask them to name their client
    • If they will not, politely tell them you are moving on.
    • Caveat: If they say they will if you give them some info, tell them your revenues and what you sell to who. Period.
  •  Only talk directly with their buyer. If they want the broker on the phone, O.K.
  • Do not give the broker any more information until the buyer signs your NDA and says the broker is covered.
  • DO NOT allow the broker to introduce you to more buyers Be adamant!

Talking with the prospective Buyer

Once you are talking directly to the decision maker at a buyer, then pay attention. Let them know you are considering your options and are discussing those options with your professionals. This gives them the impression they may have competition. Not being objective, we suggest you engage an Investment Banker to either work on just one prospective deal, or to assist you on any contact and create real competition. Qualify that buyer by determining if he can make an acquisition this size (without giving up your desired value.) Pose questions like,

  • What do know about my company?
  • Why are you interested in my company?
  • What other acquisitions have you made? Be industry specific with a PEG.

Now it is time to get your NDA signed before giving any more information

Creating Competition

  • Now, hopefully you still have more than one viable dog in the hunt and you have established the appropriate sense of competition. As you move forward, note the following:
    • Always let the elephant in the room be “other buyers”, but never name those buyers.
    • Never reveal specifically what other offers or value discussions may be.
    • Never let a buyer tell you that you should only be talking to him. It is perfectly ethical and appropriate to talk to multiple parties at once prior to your signing an LOI.

Hiring Professionals

It is obviously hard for me to stay objective when discussing this option because it involves employing an intermediary. Some form of an M&A professional whether it is an Investment Banker, a Business Broker or an M&A attorney. An Investment Banker can manage your process whether you choose to speak with one or multiple prospects and he will be able to bring even more buyers to the table.
An Investment Banker will:

  • Give you a realistic valuation
  • Respond and cull the herd without those parties knowing you might consider a sale.
  • Create a credible environment of competition
  • Be in a better position to look at your business through the eyes of the buyer.
  • Bring “Been there and Done that” expertise to the table
  • Save you and your team countless hours
  • Bring even more valid buyers to the table
  • Negotiate as a third party, preserving the relationship with the buyer
  • SELL your company so you don’t have to sound braggadocios.

Moving Forward

  • With their NDA in hand, have another informal phone call and answer most of their questions. The caveat is making sure you do not give specific customer or employee names. You can also avoid giving up any IP.
  • Let them know you have a data room prepared and that many of their answers will be there.
  • Be prepared to give up fairly detailed financial information, customer information (no names), growth plans, management staff, etc.
  • Talk about his plans for you. Would he want you to stay or phase out?
  • Now you give him access to the data room and give him some time to review that information before moving forward.

To be continued in Part III of this three-part post.

Selling your business is not an event… It is a strategic Process – PART I

By Terry Fick | Nov 13, 2018



Selling your business is not an event… It is a strategic Process.


  1. Always establish a sense, or better yet, a reality of competition for your company.
  2. Never, unless… No Never, give a prospect a price or tell them what you think the company is worth.
    1. Giving a price only sets a ceiling from which to negotiate downward.
    2. Terms are as important as price, and giving a price ignores this all-important element.
    3. Even in negotiations, until the very end, your response to a formal or informal offer is “I don’t think that offer will get you to the pole position…”
    4. At the very end you may have to counter with a definite value and set of terms.

First, let us define the possible responses to unsolicited offers to buy your company by type of buyer.


SELLING TO INDIVIDUALS? Unless your company is so small no private equity group (PEG) or corporation buyer would be interested, do not even talk to them.

Corporate Buyers

  • There are direct competitors and those that do not butt heads with you. Non-competitors are better buyers than direct competitors.
  • Ask them why they are interested. If they have a good reason, they may well be your best bet.
  • They usually want 100% and often allow (or even want) you to leave soon after a sale.
  • Don’t assume they are well funded enough to make this acquisition. Ask the right questions.

Private Equity (PEGs)

  • PEGs come in many flavors and can be very good buyers for those that would like to stay and continue to run the business… on their dime. A large majority of them are “The good guys” and can make great partners going forward. Their success rate for growing companies is outstanding.
  • A great vehicle that allows you to take almost all your chips off the table, eliminate your debt and still manage and grow your company.
  • They allow you to take, say, 90% of the true value of your business out in cash, but keep 20-25% of the equity for your second bite of the apple.
  • A good vehicle to allow you to pass on some equity to your management team or kids.
  • Make sure they are funded. There are thousands of PEGs out there that have millions and billions of cash. Be careful of relying on those that must raise the money after you committing to a sale.

Regardless of the type(s) of company you seek, there are three different paths to take:

  1. One is to be reactive and consider each contact one at a time, starting with the one that looks most likely.
  2. Another is to reach back out to all of them at once, and once you have culled the herd, open dialogues with multiple options at the same time until you eliminate all but one.
  3. The third is to let a professional quarterback the process of talking to one, several or even reaching out to more.

To be continued in Part II of this three-part post.

Buying Out A Controlling Partner

By George Walden | May 14, 2018

As an advisor for companies, I regularly encounter the situation of a minority owner wanting to buy out a controlling partner. This scenario, if handled poorly, can end in significant value destruction to the company. Owners should have a buy-sell agreement in place defining the actions that need to occur for one partner to buy out the other. Depending on the buy-sell agreement, there are a number of things a minority owner can do to make a smooth transition. Remember, this is not a situation where you’re trying to discount the value of the company. Fairness to your partner should be your first thought.

Number one, agree in advance how you both are going to measure the value of the company. What is the fair market value, should be assessed constantly? Number two, how will you and the company be able to pay for the buyout? This is an interesting dilemma for the business. This is not a situation where you’re borrowing funds to improve the company by adding equipment or funding a growth initiative. This is capital to be exchanged for equity. Banks don’t like situations that aren’t accretive. Is the company buying out the stock of the controlling shareholder or is the individual buying the stock?

A common solution to handle this situation is to have the company buy back the shares from the controlling partner in some form of structured payout, usually cash, a long term note, and occasionally, a performance upside. Another solution is to look at private equity to fund the buyout. Done with the right people, this can be a very attractive alternative because PE groups often have access to additional capital, providing financial stability, and they usually initiate growth strategies to accelerate company value.

Finally, the third, keep the conversation civil and positive. Strive to make the situation a win-win. Change is difficult for all parties in a negotiation. A poor attitude and arrogance can be very destructive to the company and to the current relationship. In closing, this is a situation where I advise using a third party negotiator such as your investment banker to facilitate the process especially if both principals trust the intermediary.

Collaborative Transactions

By George Walden | May 09, 2018

Recently, I was asked the question, “Can a transaction be a WIN/WIN?”

In sport’s we see winners and losers and assume business is that way. If someone wins then someone must lose. Too many sellers go into a transaction with the mindset, it is my company so it is my way or the highway. Strangely enough that mindset introduces risk into the equation. Risk is usually associated with a lower valuation. Unfortunately, for sellers with that mindset buyers have other options and tend to take their moneys somewhere else.

So, what can you as a seller do to make a transaction Win/Win.

1. Know your objective:
Before you decide to sell, get the expertise and advice needed to understand what you are trying to accomplish. The sale of a privately held company is a complicated process requiring knowledge, expertise and strong negotiation skills. Few business owners possess these traits at a level sufficient to complete a transaction. Have your company evaluated and prepared for the process of going to market. Understand,” what is” a fair market value for your company. Understand in advance what is important to a buyer. How they look at your business. Surround yourself with your team of professionals, accountants, attorneys, wealth advisors and M&A advisors before you go to market. Use them to assist you in filling in the gaps in your company. Allow them to do their job.
Remember: Negotiations commenced from a position of knowledge have a greater probability of achieving the desired outcome.

2. Full Disclosure:
Be an open book. If you have prepared your company properly you should be able to provide detailed information that is both accurate and verifiable. Be candid about the strengths and reveal early in the process any weaknesses.

3. Collaborate:
Be collaborative. The best deals are those where buyers and sellers are working together for the greater good. Negotiations about price are certainly a part of all transactions. But once price is established there are many things that can usually be done to facilitate the ease of transition and ensure additional value creation.

In closing, know your objective, be candid about both the strengths and weaknesses of your company and then work collaboratively to facilitate a better outcome.