Shareholders, employees, clients – these are all important individuals to keep in mind at every stage of a business – but you should also be thinking about your buyer. When it comes time to sell your business, you want to be prepared. Investors expect to be given a clear vision for your exit, including when, how, and to whom they can sell the business to in the future. Building a return profile such as this provides an understanding of what the investor will get out of the transaction, increasing the likelihood of a successful merger or acquisition.
Our team at Symmetrical has put together some tips for building your business with your buyer in mind. No matter where you are in terms of ownership, it’s not too soon – or too late – to put some of these tips into practice.
Strategize Exit Priorities
Investors buy companies for specific reasons and look for certain characteristics. Evaluating the different reasons why your company may be acquired will allow you to prioritize and highlight the values that will attract the investors you want.
Whether you’re ready to sell now or just preparing for a potential sale in the future, you should develop partnerships with potential investors throughout the course of your business. While not always the case, many acquisitions are initiated by pre-existing relationships between companies.
Relationships that you may want to consider pursuing include larger companies in your industry, distributors, suppliers, and even competitors.
Connect with Advisors
Building relationships with M&A Intermediaries early on is key and can assist with the tips above. These individuals can provide insight into what other buyers and sellers are doing in your industry, allowing you to make tweaks to your business strategy based on others’ successes and failures.
Frequently engaging advisors will keep your business in the forefront of their minds for when it comes time to sell. The more an advisor knows about your business, the more likely you will be to complete a successful transaction.
We understand that situations change and that it is difficult to think with the end in mind, but you should consider your exit strategy immediately. Contact our team of merger and acquisition advisors for guidance!