Ten Key Lessons after 20 years of M&A

Susan Rosner of Calder Associates is a member of XPX Philadelphia
Calder Associates 2 weeks ago
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As of this month, I have been selling businesses for 20 years. In that time, I have learned quite a bit about selling mid-market privately held companies up to $100M in revenue. Sharing everything I have learned would be a book, not an email😊

Here are some key lessons on my mind today.

1. Every business is unique, but every salable business shares the same characteristics.
2. A business is ready to sell when the owner is realistic about the value of his/her business.
3. During the process of selling a business, business owners learn things that they should have known when they started their business. For some business owners, that’s over 30 years ago!
4. Buyers assess value based on performance and risk, not on effort, years in business, or what deal another business was able to get.
5. Business owners often boast about top-line (revenue) performance. Well, the top line is the “ego line.” The bottom line (profit) drives value and deal terms.
6. There are usually three parties to a deal, the seller(s), the buyer(s), and the financing source. They all must be satisfied for a deal to close.
7. Legal fees are much less if the buyer and seller choose experienced transaction attorneys who are facilitators vs. litigators.
8. For business owners, due diligence is invasive. We compare it to going to a proctologist. (Use your imagination).
9. The best buyer isn’t always the buyer who makes the highest offer.
10. A deal is most likely to close if a buyer, seller, and advisors share a value for integrity and cooperation.

I will stop there for this post. The list is in no order. Feel free to email me with other learnings that you see as critical to a selling a business.

Updated: November 16th, 2022

About The Author

Call Me When… When you need a trusted intermediary to sell a business,raise funds to grow your business or grow a business through acquisition.