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Don't take on the M&A process alone

By Generational Equity

Dont take the M&A process alone

It goes without saying that the M&A process is a complex one, which is why it’s imperative that company owners considering the sale of their business are fully informed of the risks and consequences associated with trying to go it alone. Prior to taking your business to market, there are a number of issues which need to be addressed in order to prevent missteps during the sale. The most nominal of inaccuracies early on could result in implications that could later contribute to the breakdown of the process – costing all parties involved additional time and money.

It could be that you’ve become completely immersed in your business sector over the years and as a successful business owner, you believe that you’re well positioned to take on the sale of your company head on. While this may be true, even those who know their business inside out could be setting themselves up to fail without the assistance of an M&A advisor. In most cases your company will be your greatest financial asset, so unless you also happen to be an expert in deal structuring, you cannot afford to be inexperienced when it comes to its sale.

What could go wrong when selling your business?

Not knowing your business’s worth

The amount of business owners who attempt to enter the seller’s market with unrealistic expectations of their company’s value is surprisingly high. That’s why the importance of having a professional business evaluation completed on your company before you enter the market can’t be stressed enough. From this you will establish a benchmark value for your company, meaning your expectations will be in line with that of the market and you’ll be much more likely to complete a deal.

Interest from multiple buyers

While this may sound like an ideal situation for many, it has the potential to be your biggest pitfall. There is expertise required in distinguishing serious would-be purchasers from those who are just shopping around for the cheapest deal, which could prove quite a challenge for the average business owner. If your lack of knowledge in M&A is apparent you could also become an easy target for those looking to take advantage. For example, you may find yourself presented with complex and risky terms as part of an offer and may not detect the risk involved. While it’s understandable to get caught up in the excitement of the interest shown in your business, without the guidance of an M&A firm you will likely end up feeling overwhelmed when the offers come rolling in. 

Time-consuming paperwork

The process of due diligence involves a great deal of paperwork and fineprint in relation to the operational assessment of your company. There’s also an exhaustive amount of paperwork regarding aspects of accounting, legal and tax. Tax discussions can be particularly in-depth and cover a range of details ranging from tax credits to jurisdictional issues and estate planning. All of this of course takes up a significant amount of time and undertaking this yourself will mean spending time away from running your business.

When selling your business it’s vital that you have access to the relevant expertise needed to progress your sale and ultimately close a deal that’s been structured in your favour. The above examples of what could go wrong are just a small selection of the things you will need to think about. It’s worth bearing in mind that going it alone isn’t impossible, but you will need to ensure that your knowledge of the M&A process is adequate and that you are able to free up what could be up to thousands of hours to take your business to market on your own.

The other option is to obtain the services of an M&A advisor. In doing so you will alleviate a lot of the stress associated with the sale process and they will save you a significant amount of time and money in the long run.

For more information on how Generational can help you to successfully exit your business, you can attend one of our complimentary M&A workshops. To start your journey to success, find your nearest M&A workshop today.

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Greetings Mike. Thank you for the captivating and compelling presentation you made at the Phoenix presentation last week. Over many years in business yours was the most informative and well-presented presentation, on any subject, that I have ever attended! Your energy and enthusiasm combined with your concise and captivating support of your positions with easily understood examples and data was compelling.
Pete L.
I wanted to write you a quick letter to express our appreciation and our delight on the outcome of helping us through the process of our recent sale. We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.
Terry D. Wickman, President, Keytroller
Michael worked tirelessly, He followed every lead meticulously and urgently to make sure nothing was missed.
Robert Evans, President and CEO of Mealtracker Dietary Software
The process was much more involved than I expected and your help, experience and advice was a big factor in making the negotiations go as smoothly as possible.
Terry D. Wickman, President, Keytroller
We knew it would be a difficult task to have someone really understand our business and our market, prior to researching a possible buyer, so it was imperative that we found someone of your caliber, with definite proven experience in this area.
Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
We thank you Eric and Generational Equity making our dream come true.
Larry Moore, Owner, A Company Portable Restrooms
Thanks again Phil and feel free to have a future client call me if they would like a referral. You are a true professional!
Andy Graham, Vice President, Modern Heating & Plumbing
I would like to thank you and your firm, Generational Equity, for being our valued advisors in our journey.
Bil MacLeslie, CEO, ipHouse
We are very happy with the end result, and are very happy to be able to move forward with all of our future growth plans.
Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
Thank you again for all your guidance and support. Any company will achieve what they intend, if they have you on their team!
Rick Nowak, President/CEO, Kurz Electric Solutions, Inc.
Tom Staszak is one of the most professional people I have dealt with in my last forty years of business. You’ve got a great group of people and you have built a truly professional organization.
Michael J Polarek, President, Paragon Packaging
I couldn’t have asked for a better team than Michael and Deborah. We couldn’t have done it without them.
Robert Evans, President and CEO of Mealtracker Dietary Software
Bruce and I wanted to take this opportunity to thank Generational Equity for assigning Musa Jagne to our transaction. In Bruce’s words, “Musa did one hell of a job for us!”
Karen S. Williams, CFO, BW Manufacturing
Generational Equity’s assistance was invaluable in compiling and marketing our business.
Bil MacLeslie, CEO, ipHouse
I must say that I have never worked with a more driven, competent and focused individual as Don Ho.
Jay Dinnison, Owner of Sharpe Mixers
Generational Equity educated and informed us – so that we could be on the upside of a good decision (to sell).
Bil MacLeslie, CEO, ipHouse
Your wisdom and experience were invaluable to me during this once-in-a-lifetime transaction.
Ralph Noblin, President of Noblin & Associates
We will highly recommend Generational Equity and Musa Jagne to any business owner about to embark on the same process.
Karen S. Williams, CFO, BW Manufacturing
The help you provided us during each step of this process made us feel very comfortable and confident we were selecting the right approach to transition our Company.
Andy Graham, Vice President, Modern Heating & Plumbing
I quickly recognized that Don was working for Sharpe Mixers above all else, and held our interests above others.
Jay Dinnison, Owner of Sharpe Mixers
We are extremely pleased with the way Generational Equity handled the sale of our company. Your associates, Tom and Chris, did an outstanding job of getting us (me) through the process.
Michael J Polarek, President, Paragon Packaging
We were happy to see the interest in our company and what we cherished has not just a valuable company but an important company to the communities we served in.
Larry Moore, Owner, A Company Portable Restrooms