Waypoint Partners collaborated with Agency Hackers at their recent event hosted at the Roof Gardens in Kensington. Miles Welch gave an insightful presentation navigating buying and acquiring businesses. Later in the afternoon, Andy Maher and Matt Lacey led their successful Selling Surgery table, discussing the paths of selling your business to suit you. Here are a few take away pointers from the Selling Surgery session.
The selling process is a courtship. Sure, looking good with shiny awards, strong financials, some unique IP, great PR and a killer proposition will get you to the table with many buyers; but chemistry between the buyers and sellers is what’s really important to closing the deal.
During the courtship, ensure that you don’t take your eye off the business. Deals can and will fall apart if the numbers slip during the deal process. Having an experienced FD is key to ensuring you remain focused on your numbers.
Having a trusted and experienced advisor on board alongside an equally experienced legal team, driving you through the deal process is key. Don’t underestimate the technical and detailed elements of the process. Having advisors on board who can own these matters for you allows you to remain focused on leading your business.
If you want a better chance of securing a stronger multiple, don’t forget to ensure you have the right leadership team in place. This ensures that this team is locked in throughout the earn out process with EMI or other incentive schemes.
This lock in scheme is even more important if you, the Founder, wants out on day one. If that is your goal, then build the business with a leadership team in place that has proven successful in running the business without you. Having said that, if you want the best multiple for the business, then be committed to staying around for the duration of the earn out period.
The deal process is stressful and emotional. Be aware of and accept that as the process drags along, and it will at times drag along, that it will be a roller coaster of emotions. To mitigate against that, ensure that there is a clear channel of communication with your advisors and importantly, before embarking on this journey, ensure that all stakeholders and their expectations are aligned.
Effective advisors get you match fit before the deal process begins. Allow them full and open access to do pre-due diligence on your business; let them get their hands dirty. Verify and ensure all the skeletons (law suits, bad debts, shareholding issues, client & employee issues etc.) are known and addressed before the buyers start their due diligence.
Partner at Waypoint Partners