My neighbour was weeks away from selling his executive recruitment business before the financial crisis hit in 2008. Two years on, he is working harder than ever and yearning for the day the economy improves and he can put it on the block again.
I have found there to be a big gap between being approached by someone about buying your business and actually selling it. For example, The Riverside Group is a big private equity firm that buys, re-models and sells smallish businesses. Last year Riverside looked at buying 4,228 different businesses, sent love letters to 1,315 but actually only closed on 15 deals.
In other words, they walked away from 99.6% of the companies they considered buying.
I’m not sure I’m going to share that stat or the two articles below (about Riverside) with my neighbour just yet…
Selling a company is like a tennis tournament
~ published July 27, 2010 the Globe and Mail
I have found a big difference between being approached by someone to buy your business and actually selling it.
Consider the Riverside Group’s experience in 2009. Riverside is a large, successful private equity outfit that specializes in buying companies, streamlining their operations, jamming them together with other complementary companies, and selling them for a profit. »more
An eight-point checklist for selling your business
~ published July 28, 2010 the Globe and Mail
In a previous column I talked about the gates you need to pass to sell your business to a big, successful private equity firm such as Riverside Group.
Now let’s examine the characteristics Riverside looks for in a business to buy. According to its 2009 annual report, it seeks out companies that meet the following standards: »more
Letters to shareholders can help sell a business
~published July 29, 2010 the Globe and Mail
I wrote recently about how using a public-company multiple as a benchmark for what your business might be worth can lead to disappointment.
However, I did find value in looking at public companies for another purpose: Reading the letters to shareholders in annual reports in my industry helped me see what was important to potential acquirers. »more
Selling Your Business? The 2 Most Important Numbers to Analyze
~ published July 22, 2010 BNET
I was on my way home when I got the call I had been expecting from the mergers and acquisitions firm I was using to sell my company. I pulled over — this conversation was going to require some focus.
“We have two offers we’d like to meet to discuss,” said my banker. »more
