If you choose to engage someone (boutique M&A firm, business broker etc.) to sell your business, they have a consistent formula for finding you a buyer. Some brokers will have variations to their approach, but most will follow some form of the following path (I’ve presented a time line below to give you a sense of the total elapse time from the day you engage a broker to the final day you close the sale. The time line is presented as a rough guide and will vary considerably from one deal to the next):

Weeks 1 – 8 Creating “The Book”

This is a package that describes your business in detail. It typically includes a summary of your business, and historical financials along with a plan for the future. It is your brochure, so a good broker will spend a lot of time making sure it looks good and that the financials (both historical and future) are presented professionally.

Weeks 8 – 12: Create and distribute an anonymous “teaser” about your business

This is a short one or two page document that is used to attract the attention of a potential buyer. It is typically written in a way as to excite a potential buyer while disguising your company name, because the recipients will not have signed a Non Disclosure Agreement (NDA) yet.

Brokers will then push out the teaser to their contacts. Some brokers do this surgically, providing it first to some of their best relationships. However, most brokers will distribute the teaser to the widest possible list of potential buyers for your company.

If a company reads the teasers and is interested in learning more, they usually need to sign an NDA in return for “The Book”

Weeks 13 – 20 Management presentations

Once potential buyers have read the book, some will decline interest while others will want to continue with the process. For those still interested in potentially buying your company, they will request a management presentation. This is simply a meeting (typically face-to-face) where you describe your business and they have a chance to get to know you and the senior members of your team.

Weeks 21 –  24 Reviewing Letters Of Intent

Once Management Presentations are complete, you will hopefully receive one or more Letters of Intent. These letters typically make a conditional, non-binding offer which is contingent on the due diligence process. If you like one of the offers, you will typically be required to provide that potential acquirer exclusivity in the negotiation while they perform their due diligence.

Weeks 25 – 32 Due Diligence

Sometimes referred to as their proctology examination, Due Diligence is the stage where the acquirer will validate the assumptions they made about your business while reviewing The Book and interviewing you in the Management Presentations. They are looking for inconsistencies and trying to be sure about what they are buying.

Week 33 – 34 Closing

Assuming you get through Due Diligence without major hurdles, a date will be picked to close the deal. The Closing is a meeting, usually run by the lawyers from both sides, where you will be required to sign a number of documents. Once you sign the final document, funds will be wired to your bank account, and glasses will be raised because you will have just sold your business.

As the old saying goes – nine women can’t have a baby in one month. Some things just take time and selling your business is one of them. Your deal may take more or less time, or veer off this neat path at times, but you should expect the process to include some variation of these steps and to take 6-8 months.