Choosing the Right Advisors for Your Deal

Selling your business represents more than just a significant financial event in your life. It’s the culmination of substantial time, resources, and years of sacrifice. To get maximum value for your business, you need the right people around you who will have your back and help you exit well.

Over the years, we’ve helped many people successfully buy or sell a business. Some of the people we work with have an entire team of strategic advisors for their deal and some do not. Having the RIGHT strategic advisors at your side is exceedingly important in guiding you through the purchase or sale of a business and each play a unique part in helping you to achieve your goals.

Let’s look at the various advisors in more detail:

1. Attorney: A good transaction attorney can be extremely helpful in getting a deal done quickly and efficiently. They are focused on providing you with legal guidance, drawing up legal documents, identifying legal issues that may hinder the sale or cause litigation, and various other tasks. An experienced transaction attorney closes deals regularly, understands the rhythm of the deal, will be nimble and responsive, and have a compromising disposition. They understand how things get done and look for ways to say “yes” in negotiations, not reasons to say “no”. Selecting an attorney that doesn’t match this description can lead to a drawn-out deal and an expensive legal bill.
2. CPA or Accountant: In the sale of your business, CPAs and accountants are the professionals we turn to when we are valuing a business and have questions, or when a buyer is asking for custom reports in due diligence. While they are not valuation experts, they are familiar with the inner workings of your business and provide necessary information and financial documents we need to properly value and sell your business. Another critical role they can play is to help you calculate your tax impact post-sale based on the asset allocation we negotiate. We’ve done enough deals to know that not every CPA or accountant is familiar with these kind of tax strategies. If yours isn’t, we can order a tax structuring report for you.
3. Financial Advisor: You didn’t work this hard to grow a successful, thriving business only to sell it and eventually outlive your money. By working with a seasoned financial advisor, you can plug your net proceeds into their models and feel confident that you are making a sound decision for your family’s future. They will also help you invest those post-sale proceeds to ensure a reasonable rate of return based on your age and risk tolerance. Financial advisors are usually more in the background of a transaction versus being on the front lines like the attorney and accountant but, make no mistake, their input and validation is crucial. Note that we do have some tips and tricks to help you keep more of your money after the sale (which is more you can invest).
4. Business Intermediary/Broker: Of course, even with the best team of advisors, buying or selling a business shouldn’t be a “do-it-yourself” venture. Our role is to quarterback the entire deal team. We value the business, find the buyer, coordinate meetings, get the deal under contract, handle diligence, financing, escrow services, closing documents, and make sure everyone gets to the closing table successfully. We are also the only member of your deal team that you don’t have to pay unless your deal closes; this keeps everyone’s interest aligned and working every day to get a good deal done.

The bottom line is that selecting the right advisors and keeping them close during a deal is critical. They each have important roles to play to protect you, make sure your financials are accurate, and that the deal you make will provide sufficient capital going forward. How many and who you need will vary on size and complexity of your deal; we can help you decide what is appropriate for your unique situation. Our objective is to work cohesively with your strategic advisors and help you navigate the complicated process of buying or selling a business so that you get to the closing table successfully. If that appeals to you, please contact us today. We would love to learn more about your business and objectives.