This is a real-life story. A business owner is ready to sell and exit. He’s received numerous inquiries from others in his industry, has talked to a bunch of them, and sent one of them financial statements. He was then disappointed when he received a “very disappointing” Indication of Interest from this buyer.
Three lessons here:
- Stories sell. Simply sending financials doesn’t give nuances or insights. And saying, “I told them that” also doesn’t cut it because memories are short and information flows fast.
- Some people are capable of selling a business themselves, especially to unsophisticated buyers (not as likely to industry or PE buyers). But one slipup and their best deal may disappear.
- There was no guidance on price expectations or justification. It was left in the hands of the buyer, who either thought they were being generous or tried to take advantage.
There are professionals who can help (yes, a bit self-serving) and in the long run, all good advisors are worth it if they save money, time, and avoid hassles.
“The problem with socialism is eventually you run out of other people’s money.” Margaret Thatcher
“One small crack does not mean you’re broken. It means that you were put to the test and didn’t fall apart.” Linda Poindexter
