Five Things to Look for When Hiring A Dealmaker
You have owned your business for 30 or 40 years and you’ve finally decided that you are going to sell it with a plan to retire. So often, the thing business owners who are in this position dread most is how and when to tell their employees. They know it is going to be a shock them. There will be tears, disappointment and maybe even anger.Business owners, one would think, can do a fine job selling their own companies. They’ve been selling stuff their whole lives. Sure they can sell their own companies. Not so fast! Selling your own company is very different from selling other goods and services. It’s very time consuming. It is always an emotionally taxing experience and doing all the leg work yourself only adds to the enormity of the task.
Because selling your own company can be so difficult, my advice is always to use an intermediary. The person may be called an investment banker or a broker or just an intermediary. But whatever one calls the person, making a good choice on whom you bring in will be of key importance to the eventual success of the experience. What should a seller look for?
Analytical and Sales Skills
People in this field should have both the ability to analyze numbers and to navigate through an orderly sales process. Knowledge of and experience in accounting and finance can be crucial. Sales from both an ability and personality standpoint is also key. I was an intermediary for decades. I came at it from the numbers side and had to teach myself how to be salesman.
Honest and Ethical
You should want your broker to be honest – with buyers and with yourself, too. Being untruthful with buyers in the guise of salesmanship will never be a successful long term strategy. Also, you should want your representatives to be honest with you no matter how much such honesty may hurt.
Selling a company can often be a 24/7 proposition. Anybody you think may shy away from this kind of time commitment would not be a good choice. You should be certain the banker you’re considering has the business-meeting-convo.jpg bandwidth to devote to his deal. Being really busy might be good for the dealmaker, but it is not as good for you as the seller.
Patience and Perseverance
Selling a company, from start to finish, typically takes nine months to a year. Some will claim they can do it in three to six months, but that’s quite rare. Sometimes it takes much longer – a year or more – but nobody talks about those deals. Some say a deal has to die three times before it is ready to close. Things happen to challenge every deal. Good dealmakers are patient and they never quit.
Chemistry With the Dealmaker
It’s better when you and your broker like each other. You’re in a foxhole with the dealmaker for a long time and it’s better if you like the person you are with. A dealmaker will be calling you at all hours of the day and night. The dealmaker will likely be on a first names basis with your spouse and may get to know your family, too. You will be sharing a lot with your dealmaker. Pick somebody you like.