Sale Process Archives - Win Your Exit

14May 2018 by thannon10

Tom Hannon – Featured On Built To Sell

Advisors, Buyer, Deal Book, Deal Structure, Due Diligence, Factors Affecting Business Saleability, Preparing to Sell Your Business, Sale Process, Tax Implications of Selling a Business, Transition, Valuation, Why Sell

From the Built to Sell Podcast Description of the Show - Tom Hannon started FPD to create and distribute niche publications. He grew the company to $3M in revenue over 18 months, when a family illness prompted him to reach out to acquirers. His company was valued at $2.1M and received four offers, but he ended up walking away with $1.5M. Hannon candidly shares why he left money on the table, and what he would do differently if he had a re-do. In this episode, you’ll learn: • One trick the acquirer played on Hannon that dramatically devalued his business • How Hannon used a third-party valuation to keep the price as firm as possible • When not to overplay your hand in a negotiation with an acquirer One reason…

30Mar 2018 by thannon10

Danger of market timing the sale of your business

Deal Structure, Sale Process, Strategy

The other day I was speaking with a successful CEO in his fifties who runs a heating and air conditioning company generating eight million dollars in revenue and over one million dollars in profit before tax. Even though he was tired and nearing burnout, he was planning to wait another five to seven years before selling his business because he “wanted to sell at the peak of the next economic cycle.” On the surface, his rationale seems to make sense. If you speak with mergers and acquisitions professionals, they’ll tell you that an economic cycle can impact valuations by up to “two turns,” which means that a business selling for five times earnings at the peak of an economic cycle may go for as low as three times earnings at…

30Mar 2018 by thannon10

Is Now the Time To Sell Your Business?

Deal Structure, Exit Planning and Its Benefits, Sale Process, Uncategorized

Have you been thinking about selling your business but just can’t decide if now is the best time? Do you find yourself repeatedly analyzing the economic situation and wishing you had a crystal ball? There are positive signs and there are negative signs…. If you’re still up in the air and can’t quite decide whether or not to hit the eject button, here are five reasons you might want to consider getting out now. You’re less interested in fighting the good fight A lot of business owners took the Great Recession in the teeth. If you’ve got your business stabilized and the prospect of possibly having to fight through another recession leaves you panic-stricken, it could be time for you to get out. 2. The worst is behind you Let’s…

30Mar 2018 by thannon10

8 Questions You’ll Be Asked When Selling Your Business

Exit Planning and Its Benefits, Factors Affecting Business Saleability, Preparing to Sell Your Business, Sale Process

One of the most intimidating aspects of selling your business can be facing the barrage of questions during the various management presentations you’ll be doing for potential acquirers. Be prepared to be grilled on all facets of your operations. Of course, every meeting will be different, but here are some questions you can expect to be asked when you’re in the hot seat: Why do you want to sell your business? It's a slippery question because if your business truly does have a bright future—and you want the buyer to believe that's the case—the obvious question is: “Why do you want to sell it, and do would you want to sell it now?” What is your cost per new customer acquired? The potential acquirer wants to find out if you have…

29Mar 2018 by thannon10 No Comments

7 things to do before signing a Letter of Intent

Buyer, Sale Process, Transition

You may be years away from selling your business, but it’s never too early to understand what the process involves. If you have ever promised your child a treat in return for good behavior, you know all about negotiating leverage. When selling an attractive business, you also have leverage—but only up to the point where you sign a letter of intent (LOI), which almost always includes a “no shop” clause requiring you to terminate discussions with other potential buyers while your newfound “fiancé” does due diligence. After you sign the LOI, however, the balance of power in the negotiation swings heavily in favor of the buyer, who can then take their time investigating your company. At the same time, with each passing day, you will likely become more psychologically committed to…