I got a call from a business buyer who asked me what he should do to satisfy banks who wanted to know why he’s a good fit for his target business given he has no direct industry experience.
Acknowledging Daniel Pink and his book, “To Sell is Human” (Riverhead Books, 2013), we are all always selling. In this case it’s the buyer selling himself to the bank. I went back many years to a document we give buyers that outlines how to present oneself to banks. The top things in this case are:
- Put together an overview of your skills and why they’re applicable to the business. In this case the buyer is a former business owner, he’s managed people, processes, and money, the target business does projects, and his previous company did projecs, plus the seller is staying on for an extended transition period.
- Have the seller write a short note (letter) saying why he’s confident in the buyer.
- Ask business friends to write reference notes on the buyer’s abilities.
In the small business to lower middle market it’s rare when a buyer has direct industry experience. What they have is relevant leadership and management abilities. But people in a cubicle often need convincing.
“My whole family are psychics. I was born with the gift of hindsight, I realized later.” (Comedian) Luke Rollason
“For every complex problem, there is an answer that is clear, simple, and wrong.” H.L. Mencken
