Savvy Investors Find Value in Cross-Border M&A

Economic headwinds and geopolitical uncertainty tied to the war in Ukraine, rising interest rates, inflation, market volatility, supply chain issues and a fear of an impending recession have created uncertainty that has adversely impacted valuations and deal volume. Despite these concerns, cross-border M&A continues to outpace domestic dealmaking. 

“Despite the uncertainty in the current global climate, cross-border transactions continue to offer compelling opportunities for strategic buyers seeking diversification and market expansion opportunities,” says Enrique Martin, partner and managing partner of Winston & Strawn‘s Miami office. “Global instability will continue to produce opportunities for the savvy investors where others can only see high levels of risk. Investors with higher risk tolerance will see the current market conditions as an opportunity to acquire attractive targets at discounted prices.” 

Martin tells Mergers & Acquisitions that industries that will see the most cross-border deals include those that are considered recession proof. Industries like FinTech, including the payment processing and digital payment industries, energy, healthcare and telecommunications, are expected to see the most opportunities 

Rising inflation and interest rates in the U.S. are influencing dealmaking by causing debt financing to be more costly and asset divestment to become increasingly more difficult. These increased levels of inflation also yield higher costs of goods and services which will as a result, drive valuations down. Such a volatile environment is expected to present opportunities for strategic investors with cash reserves or access to other capital. For example, multinational firms seeking investment opportunities in new markets or firms with a higher tolerance level of risk looking to capitalize on undervalued targets. 

“These strategic transactions tend to be less price sensitive because they are motivated by reasons other than an opportunity to buy at the lowest possible price,” says Martin. “Demand for M&A is expected to remain consistently high among buyers looking for targets that represent opportunities for growth or international market expansion.” 

Private companies pivot to conserve cash to await eventual opening up of IPO market

Private valuations have yet to catch the knife of sharply lower public equity prices as capital sources dry up. 

Private equity and venture capital-backed companies are faced with conserving cash and shoring up costs in the choppy stock market of 2022, as capital from initial public offerings and syndicated debt markets dries up, investment executives at Goldman Sachs said. 

Private debt providers have been able to step in to provide capital in a challenging economic environment, as institutional investors ponder the cash requirements of businesses they support in the face of inflation and the prospects of an economic slowdown in 2023. 

"There is an extreme focus on cash and cash runway -- cash becomes king," said Nishi Somaiya, global co-head of growth equity at Goldman Sachs Group Inc. (GS). "We're very focused on the ability to weather a more challenging environment. Growth rates will be lower, so cost bases have to be adjusted. Scenario planning is something we're focused on."

How to Find the Right M&A Advisor

Finding the right M&A advisor is a task worth spending time on. The right advisor can make or break your business transaction, and there are lots of options to choose from. Here’s why it’s so important to get this right, and how to maximize your chances of connecting with the perfect M&A advisor.

Selling a business is not a one-person job. It’s a highly complex, time-consuming process with incredibly high stakes, and it requires a team of people all working together in close alignment.

One of the most important players on your sell-side team is the M&A advisor. This role is often criminally overlooked and underrated, but it’s no exaggeration to say the right M&A advisor can make or break your transaction.

In this article, we’ll look at why M&A advisors are so valuable, what they bring to the transaction process, and the steps you should take to connect with the perfect M&A advisor for your business and goals.

What does an M&A advisor do?

Your M&A advisor is your trusted guide, helping you navigate the murky and treacherous landscape of selling your business. The best M&A advisors combine experience, connections, and skill to ensure you get the best possible outcome, aligned as closely as possible with your goals.

Here are some of the key responsibilities of an M&A advisor:

• Be a constant source of advice and guidance as you go through the sale. Your M&A advisor should be someone you can always get in touch with to share their wisdom and expertise at any point during the sale.

• Draw on their pool of connections to bring you in contact with all the right people. This ranges from obvious connections, like potential buyers, all the way to niche specialists who can help you work through specific areas of your sale.

• Understand what makes your situation unique and tailor their approach accordingly. Selling a business is not something to take lightly — it may very well be the single largest financial decision you ever make. As a result, it’s crucial for your M&A advisor to understand your specific situation, help you avoid mistakes, and be someone you can place a great deal of trust in.

• Make sure your company is valued correctly. Valuation is one of the most important aspects of an M&A transaction. It involves striking a careful balance between many factors to ensure you get a fair price for your business without scaring off all potential buyers.

• Help you beyond the sale. A good M&A advisor will get to know your long-term goals, including what you plan to do next after your business is sold. This allows them to give you more relevant guidance and advice, ensuring your company changes hands in a way that’s aligned with your goals and the goals of your team.

What makes a good M&A advisor?

A good M&A advisor combines a number of key skills. Here’s what you should look out for when choosing your advisor:

• Relevant experience. Your M&A advisor should have a solid base of experience assisting in the sale of businesses like yours, in similar industries, with similar transaction types.

• A strong track record of getting results for their clients. You should spend time researching your advisor’s past achievements before working with them, and don’t be afraid to reach out to their previous clients for testimonials.

• Trust. Your M&A advisor will be guiding you through one of the biggest business transactions of your life, with an enormous amount at stake. It’s essential to have a strong rapport with your advisor and the ability to trust them with the sale of your business.

How much do M&A advisors charge?

M&A advisors all charge different amounts, and the amount your advisor will charge will depend on a number of factors like the size of your business, the value of the deal, the time involved, the experience and reputation of the M&A firm, and many others.

Usually, M&A advisors will charge a fee upfront, usually ranging from a few thousand dollars to the high five figures and beyond.

After that, fee structures are often based on a percentage of the total sale amount, for example, 5%. It’s well worth taking the time to discuss pricing with your M&A advisor early on to establish whether it’s worth it for you and to avoid any unpleasant surprises later.

What do you need to know from your M&A advisor?

There are some key questions you should ask your potential M&A advisors as soon as possible while getting to know them. Getting these questions answered allows you to work out if an M&A advisor is right for you and your needs, and avoid any future issues. Here are some questions you should ask:

• “How will you find the value of my company?” — ask your potential M&A advisor about the methods they typically use to value companies and how they would approach yours.

• “Is now the right time to sell my business?” — A good, trustworthy M&A advisor will give you a clear and honest answer to this question. The answer may be “no”, and they might advise you to wait for a better opportunity.

• “What similar deals have you worked on?” — This question allows you to get a feel for your potential advisor’s experience and how it compares to your circumstances and specific goals.

• “What does your process typically look like?” — Ask about things like time frame, marketing strategies, and typical milestones to gain an idea of how the transaction process will look and how you can prepare and set your expectations.

• “How will my business operations be impacted?” — The M&A process is long and often complex, and your business operations could be affected. Ask your potential advisor how this could happen and the steps they will take to help you focus on your business.

How to find the right M&A advisor for your transaction

Finding the right M&A advisor won’t be a quick process. You should take your time here, and you’ll probably talk with a number of potential advisors before settling on the right one for you. Here are the steps to follow when seeking out your M&A advisor.

1. Start early

It’s not uncommon for business owners to start building their relationship with their M&A advisor years in advance of the sale. Even if you don’t have concrete plans to sell your business any time soon, it’s still wise to make connections with M&A advisors ahead of time and start laying the foundations for a relationship.

Starting early gives you time to get to know your advisor, and for them to get to know you and your business. This way, when the time comes to sell, they already have a firm understanding of who you are, what you do, your goals and future plans, what a successful outcome looks like for you, and much more.

2. Research, research, research

It’s impossible to understate the importance of research when it comes to choosing an M&A advisor. Spend as much time as possible learning as much as you can about a number of different M&A advisors.

There are many resources you can use to research advisors. Their own websites and social media profiles are a good place to start — browse the content they share and read about their backgrounds and past accomplishments. 

Once you have narrowed down your search to a handful of promising advisors, get in touch and open a relationship with them to learn more and hone in on the best fit. Prepare questions in advance and try to learn as much as you can about their previous work and how they have helped businesses like yours.

3. Ask others in your industry for their recommendations

Your personal network is an invaluable resource for connecting with your ideal M&A advisor. Reach out to fellow business owners, attorneys, accountants, investors, and more. These people will all likely know several M&A advisors and can point you in the right direction of someone who could be a good fit.

Ideally, you know someone who successfully completed a transaction similar to yours and got results that match your goals.

Work with BizNexus

Finding the right M&A advisor is a challenging task. It’s something that often takes months or even years, and it’s a task that deserves serious time and effort. The right M&A advisor can make or break the sale of your business, so it’s well worth investing heavily in the search for one.

The BizNexus community is home to many M&A advisors, from various backgrounds and with a range of skill sets and specializations. It’s a great place to connect with advisors, grow your network, and possibly get in touch with the advisor who can make your transaction goals a reality.

Funding When Capital Isn’t Cheap

"When capital becomes more expensive, how do you evaluate and decide on the best financing option for your company?”

Asks Shangda Xu, Alex Immerman, and David George from a16z.

There is (or at least there should be) a VC industry saying: “Give me your headline price, and I’ll give you a deal.” The idea here is that founders tend to think in terms of valuation and dilution, while an investor might be more interested in knowing their minimum guaranteed return on the downside and the size of potential returns on the upside.

In a normal market, investors sometimes, but less frequently, use contract terms—such as liquidation preferences that are greater than 1x, warrants, and anti-dilution clauses—to invest at the valuation a founder wants, but with terms that make sense for the investor. In a down market, when capital is more expensive and valuations are down, these structured deals—that is, a deal with non-standard clauses—become more common, as founders look for ways to avoid raising money at a lower price per share than your previous round (i.e., a down round). "

Despite Recession Jitters, M&A Dominates a Robust Cybersecurity Market

Funding has been somewhat lower than last year, but investment remains healthy, analysts say, amid thirst for cloud security in particular. 

The cybersecurity industry continues to remain largely unaffected by the uncertainty surrounding the rest of the economy.

Though funding activity this year is somewhat slower than in 2021 and market valuations of cybersecurity firms have taken a hit, mergers and acquisitions activity has remained strong through the year, as has investor interest in the sector.

So far in the third quarter, there have been multiple major transactions that, according to analysts, highlight the overall robustness of the sector amid broadening concerns of a recession. 

Says Jai Vijayan from darkreading.com.

Pipedrive CRM

Invaluable Resource For Managing Your deals, leads and sales activities

Become our partner and get access to our training workshops and actionable templates as we make those available through our Lunch & Learn topics.

Current valuation markdowns may lead to incredible investment opportunities

Adrian Mendoza, Mendoza Ventures founder and general partner, joins 'The Exchange' to discuss whether the slowdown in markets is a good thing for venture capital and why deal making could be stronger in the next 3-5 years.

“We'll start seeing valuation markdowns in the next 3-5 months. And really that is an opportunity for investors to come in and buy well-known start-ups at a low valuation,” says Mendoza Ventures' Adrian Mendoza, “In our view the M&A market is going to be incredible in the next 3 to 5 years.”

5 Ways CFOs Can Ensure M&A Deal Value in a Volatile Market

Amidst rising inflation and interest rates, stock market volatility and geopolitical instability, high-value investment opportunities like mergers and acquisitions may sound out of reach. In fact, the number of deals fell almost 17% year over year in February 2022, while the value of those deals dropped 30%, according to S&P Global Market Intelligence. 

Even more sobering news, investments in M&A are on the chopping block, according to 41% of CEOs and CFOs asked in a June 2022 Gartner survey which cuts were likely in the face of continued economic disruption."

Selecting an M&A deal partners that can execute a complete solution is one of the ways to help overcome barriers to delivering speed to insight, speed to transform, and speed to execute pre- and post-close.

“Look for partners that can help in the short and the long term, who can turn recommendations into outcomes, data into action, and plans into completion. Look for end-to-end partners who will work with the organization to align owners, help with the delivery, build the solutions, and execute them,”

Says Stephen Mortimer from cfo.com.

Recent Trends In Canadian M&A

ESG is an acronym that has turned into a buzz word. Nevertheless, its components – Environmental, Social and Governance – remain critical as companies engage in business transactions, such as M&A, or develop business strategy. 

“We serve a range of clients, and they span Canadian business sectors. At the most sophisticated and largest public companies such as banks, mutual funds and pension funds, ESG topics occupy centre stage within the investment committees, within the CIO's office, and within the C Suite. At smaller and medium-sized enterprises as well as private companies, you tend to see businesses that are less burdened from a regulatory landscape, which results in a lower degree of urgency toward ESG. However, this is changing. There are very few clients that are entirely indifferent to or not apprised at all as to ESG topics, and the projections are that every business, small and large, is going to be impacted by ESG in the future in a meaningful way,”

Says Jason Kroft, a senior corporate lawyer in Miller Thomson's corporate practice with specialization in structured and alternative finance.

Regulatory Challenges May Lower M&A Event Risk for US Corporates

Fitch Ratings-New York/Chicago reports that rising interest rates and heightened antitrust regulatory scrutiny may discourage strategic acquisitions for US non-financial corporates, which could lower M&A event risk through the next cycle.

We have found that large acquisitions by corporate debt issuers often precipitate a rating downgrade of the acquirer, after reviewing selected transactions within our rated portfolio.

However, an M&A slowdown may not hamper leveraging transactions. Companies deterred from pursuing acquisitions may instead prioritize returning capital to shareholders through debt-funded dividends and stock buybacks. Conversely, companies that move forward with acquisitions may embark on a lengthy and costly regulatory process,” Fitch Ratings says.

Recent changes by the US Federal Trade Commission and the Department of Justice are designed to increase the number of acquisitions that face antitrust scrutiny in order to, among other things, protect consumers by reducing the prevalence of anticompetitive practices.

Revenue Synergies for a Successful M&A Strategy

“Companies engage in mergers and acquisitions with the expectation that the merger or acquisition will generate more revenue than the entities would when operating separately. Simply put, they hope the whole will achieve greater results than its parts.”

-Great article on what to expect with revenue synergies for a successful M&A strategy.

This excess revenue generated by the combined company following a merger or acquisition (M&A) is called revenue synergy and it mutually benefits both the target and acquiring companies.

While generating revenue synergies seems simple and viable in theory, synergies depend on many uncertain assumptions. These include cross-selling, market expansion, proper integration, and the introduction of new products. These factors affect how much revenue synergy the combined company can achieve.

Read the full article originally posted on Newswires here:

Global Fintech M&A continues two-year climb to defy broader M&A slowdown

Global Fintech M&A rose sharply in the first half of 2022 with 591 recorded deals, defying the broader M&A slowdown, according to the latest Hampleton Partners’ Fintech M&A Report.

“Fintech is proving to be a very attractive target for financial and strategic dealmakers, defying the broader global M&A slowdown. As for the impact of any potential recession, there is one major difference between now and the previous real recession of 2008. This year, deployable private capital, including buyout, VC, growth and real estate, hit its highest level in history at $3.6 trillion - three times the figure in 2008,”

Says Miro Parizek, founder and principal partner, Hampleton Partners, an international M&A advisory firm for technology companies.

The Pros and Cons of LinkedIn for Connecting with Buyers and Sellers

For businesses, LinkedIn is one of the most powerful online communities out there. With over 300 million monthly active users, LinkedIn is the perfect place to connect with potential buyers and sellers, business brokers, M&A advisors, and more.

To learn more about LinkedIn and its value, we asked the BizNexus community to share their thoughts on LinkedIn and its pros and cons.

How do you feel about LinkedIn as a valuable platform for identifying potential buyers & sellers? What are the strengths & weaknesses?

Join the Conversation

The BizNexus Community

We bring together entrepreneurs, investors, and M&A experts to master the process of getting your business acquired or recapitalized, so we can learn how to set up a great deal team, financing, and exit plan from a network of industry professionals & advisors.

---

---

The Most Common M&A Mistakes Owners and Sellers Make

The M&A process is complex, and the exit process is often rife with challenges and potential mistakes. Before you begin the process, it helps to get familiar with some of the most common errors here so you can take steps to avoid them and learn from the mistakes of others.

To get you started, we asked the BizNexus community to share some of the most common mistakes they see owners and sellers making during the M&A journey.

What is the #1 mistake you see owners/sellers make over and over again?

Join the Conversation

The BizNexus Community

We bring together entrepreneurs, investors, and M&A experts to master the process of getting your business acquired or recapitalized, so we can learn how to set up a great deal team, financing, and exit plan from a network of industry professionals & advisors.

---

---

Strategies for minimizing taxes for exit planning strategy

What are the best strategies currently available for minimizing taxes heading into a transaction?

We recently asked our community of M&A Advisors and related exit planning professionals about tax strategies related to the sell-side transaction and how to sell a business.

Here are some of the highlight answers from the pros:

Join the Conversation

The BizNexus Community

We bring together entrepreneurs, investors, and M&A experts to master the process of getting your business acquired or recapitalized, so we can learn how to set up a great deal team, financing, and exit plan from a network of industry professionals & advisors.

---

---

Featured M&A Advisor & "Tax Whisperer" — Bob Fariss

Our featured M&A Advisor this week is Bob Farris from BuildValueHere.com, who launched his business in 2010.

Tax Advisory & Exit Planning Strategy

Bob is an M&A Advisor in Texas, and is known well throughout the industry as a “tax whisperer” expert when it comes to advising on exit planning strategy and how to sell a business in line with optimal planning for tax consequences, adjustments and benefits uncovered for your unique business.

One of the biggest challenges when it comes to selling a business is understanding the labyrinth of tax issues and safely navigating this process to ensure you stay on the right side of the law, avoid any unnecessary payments, and get things done as efficiently as possible. This is where Bob can help.

Small Business M&A With a Focus on Tax Planning

Bob and his team help businesses successfully transition by understanding the many stages involved, planning carefully, and taking the right steps to ensure a smooth and successful process. Bob works with both owners and brokers to market the business in the best possible way.

His experience is a valuable asset for sellers looking to do due diligence when it comes to the tax element of their transaction. Understanding tax returns is a particular challenge here that Bob is well-placed to assist with.

In turn, Bob hopes to be able to learn from the community, especially when it comes to managing industry acquirer lists. Get in touch with Bob to find out how he can help you confidently tackle the tax challenges of selling a business.

Get in touch with Bob

You can chat with Bob here through his BizNexus profile, or send him an email at bob@buildvaluehere.com.

INTERESTED IN GETTING FEATURED IN THE BIZNEXUS COMMUNITY?

Each week, we give our community members the opportunity to be featured members to highlight their industry niche and let everyone know a little more about their niche and practice.  We want to give the community the chance to network and create opportunities. 

If you'd like to join the queue to get featured, all you need to do is answer a few questions and we'll take care of the rest.

Featured Small Business Lender — Deb Curtis

Lending in the World of Small Business M&A

Our featured member this week is Deb — an expert in SBA business acquisition lending with many years of experience in business banking.

Based in Elkhorn, WI, Deb owns Curtis Small Business Finance Solutions and has been running it since 2018.

Getting a Loan To Buy a Business

Deb spent 15 years as a business banking lender, and it was during this time that she came to a realization: that all unsecured business lending roads eventually lead to SBA. She began coaching small business buyers one-on-one, helping them boost their chances of obtaining final SBA credit approval.

For Deb, specializing in owner-financed transactions was the right decision. She says, 

“There are a plethora of ‘Jack of All SBA Credit Requests’ lenders out in the market today.  I decided to be a ‘Master of One’ by working solely on change of owner-financed transactions 24/7.”

Deb’s expert knowledge and experience make her a valuable addition to the BizNexus community. She’s here to share what she knows and help more business buyers access credible help with SBA financing.

Niche Verticals & How To Buy Into a Business

Deb works with commercial loan brokers, business brokers, business bankers, and small business owners. She provides capital to buyers of small businesses ranging from $500,000 up to $5M, and works throughout the USA.

Who Does Deb Help?

Deb’s company helps small business owners achieve their dreams of leaving corporate America behind and starting out on their own. She works 1:1 with aspiring small business buyers, helping them secure SBA funding within 10 business days to get an immediate owner salary and working capital.

Deal Origination & Networking

It’s her goal to connect with more people who want help in this area through podcasts, LinkedIn Live Events, speaking engagements, broker presentations, social media channels, and more.

Get in touch with Deb

To chat with Deb, connect with her on BizNexus or send her an email at curtisbfs@gmail.com.

INTERESTED IN GETTING FEATURED IN THE BIZNEXUS COMMUNITY?

Each week, we give our community members the opportunity to be featured members to highlight their industry niche and let everyone know a little more about their niche and practice.  We want to give the community the chance to network and create opportunities. 

If you'd like to join the queue to get featured, all you need to do is answer a few questions and we'll take care of the rest.

Featured Business Broker — Tyler Evans

Exit Planning in California

Meet Tyler, our featured business broker this week. Tyler is an active member of the BizNexus community & a passionate M&A advisor focused on exit planning and teaching entrepreneurs how to buy a business.

Tyler Evans - How To Sell a Business

When it comes to business, Tyler started early. His father started SoCal Business Brokers back in 1992, and Tyler grew up stuffing envelopes and helping around the office, along with daily mental math quizzes. After graduation, it was only natural for him to step into the family business, and when his father retired, he took over. Now, Tyler blends the firm’s old-school approach with his own knowledge of social media and digital marketing.

A Family Background in Small Business M&A

As an entrepreneur turned intermediary, Tyler is a 3-time small business owner who blends real-life experience with his practice of working with business owners in an effective way to position themselves for an optimal exit and valuation. 

Who Tyler Typically Helps With Exit Planning Services

Tyler’s clients are typically people that have built a business over many years and are now at the point in their life when they would like to retire or move on to their next adventure.

Part of life is setting a goal and working toward it, so I find it useful to share my own personal goal with potential clients to share in the spirit of moving forward with the next step in their career or life. My ideal retirement includes buying 40+ acres of land, and building a homestead where I can grow my own food, fix up an old ford side step truck, build my own house, and fish on a river that runs through the property. Give us a call to discuss your business and we can consult with you on what your next steps should be as you take the next step in your journey. - Tyler Evans

Industry Focus - Exit Planning & Deal Origination

Tyler has worked with clients in Manufacturing distribution, hi-tech and e-commerce, along with a wide range of service businesses including medical practices, engineering, investment advisory firms, spas, and much more.

His motto: educate, not sell. 

"We're set up to educate, not to sell. That goes a really long way with business owners."

Get In Touch with Tyler

You can chat with Tyler Evans here through his BizNexus profile, or send him an email at tyler@so-calbusinessbrokers.com.

Services & Exit Planning Strategy

Tyler's business model supports the seller's needs and goals. As a generalist broker, he's closed over 500 transactions from various businesses, ranging from $1-5 million. His "sweet spots" include manufacturing distribution, wholesale, and e-commerce

Interested In Getting Featured In The BizNexus Community?

Each week, we give our community members the opportunity to be featured members to highlight their industry niche and let everyone know a little more about their niche and practice.  We want to give the community the chance to network and create opportunities. 

If you'd like to join the queue to get featured, all you need to do is answer a few questions and we'll take care of the rest.

Featured Intermediary — Mark Mroczkowski

This week, our featured member is Mark — an experienced businessman, CPA, and entrepreneur. A graduate of the College of Business at Florida State University, Mark has spent 40 years representing business owners and arranging deals.

Mark’s Background

Today, Mark works at Chapman Associates, where he’s worked with an incredible range of industries including Information Technology, General Aviation, Oil & Gas, Manufacturing & Distribution, and Food and Beverage.

Mark’s skills lie in tech, specifically MSPs and IT managed services. His career is a long and illustrious one — he spent the first half in public accounting practice, specializing in audit, tax, and financial consulting to privately owned and publicly traded corporations.

Later, he moved into the technology, internet, and oil and gas industries, and served as Chief Financial Officer for three different publicly-traded companies and one university. 

A Global M&A Career

Mark’s M&A experience spans the entire globe — he has worked on more than 16 acquisitions, mergers, and divestitures in places as diverse as Michigan, Florida, Australia, China, and South Africa.

On top of all this, Mark has also been the owner of a CPA firm, an equipment leasing company, an import-export firm, and a beer distributorship in Moscow. He’s also been the co-owner of an independent oil & gas producer and an independent consultant to several different industries.

Who Does Mark Help with M&A?

At Chapman, Mark works with middle-market companies (valued between $3 million and $150 million), providing consulting and advisory services throughout the M&A process to give these businesses the same resources and support as much larger organizations.

Mark is a Florida Certified Public Accountant and a Florida Licensed Real Estate Broker and is a valuable source of knowledge when it comes to a wide range of M&A topics. He’s a welcome addition to our community.

Get In Touch with Mark

You can chat with Mark Mroczkowski here through his BizNexus profile, or send him an email at mark@chapman-usa.com.

Interested In Getting Featured As A New Member?

Each week, we give our community members the opportunity to be featured members to highlight their industry niche and let everyone know a little more about their niche and practice.  We want to give the community a chance to network and create opportunities. 

If you'd like to join the queue to get featured, all you need to do is answer a few questions and we'll take care of the rest.

How To Sell a Business To Your Management Team

Selling your business to your existing management team is a common choice for many owners.

There are lots of benefits to handing your business over to people you know and trust, and who understand the ins and outs of working there along with your goals, values, challenges, and vision.

At the same time, this kind of transaction comes with its own set of unique challenges. Some questions you might want to answer are:

How much equity should you give to key employees?

How can you get your financing lined up?

What about confidentiality? How can you flesh out your options without compromising a potential alternative exit option?

What about your customers? How do you transition them over to the team? How do you keep them on board with your transition plans?

We asked the BizNexus community to share their thoughts on selling your business to your management team and their key considerations. Check out their responses below.

Join the Conversation

The BizNexus Community

We bring together entrepreneurs, investors, and M&A experts to master the process of getting your business acquired or recapitalized, so we can learn how to set up a great deal team, financing, and exit plan from a network of industry professionals & advisors.

---

---