Selling a company: THE VENTURE 7 METHOD.
Experience + discipline + imagination + transparency.
Building a successful business requires years of hard work and sacrifice. When you sell your company you should reap the full reward.
We approach the sale of a business differently than traditional investment bankers and business brokers. We've figured out how to serve small-to-mid-sized companies with a level of sophistication that was previously available only to big corporations.
Venture 7 clients benefit from our systematic approach to preparing, marketing and negotiating business sales. We combine industry best practices with the insights we’ve gained through starting, growing, and selling our own companies. Our process maximizes value, minimizes business disruptions and moves efficiently through negotiation and closing. Scroll down for details.
THE VENTURE 7 METHOD.
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Preparing your company for sale.Venture 7 will help you prepare your company for sale by getting to know you and your business, understanding your motivation for selling and your plans for the future. We develop a 360-degree view of the business, including financials, management structure, market position, and an assessment of operations. We put together a preliminary valuation estimate and preliminary recommendations for marketing the business to prospective buyers. We also identify actions you can take now to enhance the value of your company. We discuss your options and formulate a plan. Sometimes, the best plan is to postpone the sale and focus on increasing the value of the business. If you do decide to go ahead with a sale, we move forward together.
Valuation and presenting your company.We prepare a comprehensive financial valuation and also identify intangible elements of value that will appeal to strategic buyers, including intellectual property, brand equity, Internet reach management team and more. We develop an in-depth understanding of your company, your industry, your team and your customers. We compile and organize all the information that sophisticated buyers will ask for. Any gaps in documentation will be corrected before we go to market. With your help, we define several types of target buyers and create a variety of presentation materials that convey the value and potential of your company. We design a compelling Confidential Information Memorandum (CIM) that describes your company in detail, and a one-page business summary (called a 'teaser'). We develop content for online marketing tools that present your company in its best light and are consistent with your brand.
Outreach to potential buyers.Strategic Buyer Outreach If you're looking for maximum return (as opposed to a fast sale), we approach potential strategic buyers first. Unlike financial buyers, who are in the business of buying and selling companies, strategic buyers are those who will view your company as a strategic fit within their existing business model. They're more likely to pay a premium for your company, but they also tend to move more slowly. Strategic outreach is hard work and it takes time, but engaging these buyers early is the best way to maximize your chances for a top-dollar exit. General Outreach General outreach is a combination of advertising and direct contact with the entire universe of potential buyers. We post ads and sale listings on the right mix of online marketplaces and industry exchanges. These sites are actively monitored by buyers, but we don’t rely on being “found”. We reach out directly to carefully targeted potential buyers to generate interest in your company. Other business brokers and investment banks begin the marketing process with general outreach. If your goal is a fast sale, that may be the right choice. The risk of early general outreach is that fast-moving financial buyers will dominate the sale process before we have an opportunity to engage with potential strategic buyers. We encourage our clients to be patient at this stage; a little patience can be very profitable!
Turning interest into offers.As our outreach on your behalf progresses, there may be several potential buyers who express interest in your company. Our job is to qualify them and engage the legitimate prospects. Non-disclosure agreements are signed and successively more detailed information about your company is revealed. Our objective is to encourage prospects to present purchase offers. We work to improve those offers until a lead candidate stands out and executes a Letter of Intent to buy (LOI).
Due Diligence.With a Letter of Intent in place, the buyer and their representatives will review your financials, legal documents, employee files, lease agreements and more. They will want to make sure that they’re making a good decision in buying your company. This is where Venture 7’s assistance really pays off. We will already have worked with you to prepare for due diligence. We will have anticipated most of the buyer’s information requests and organized our responses. We will either have fixed problems in advance or disclosed them earlier in the process. We know how to manage the due diligence process so that you’re shielded from tense discussions and can continue running your business with minimal distraction.
Final negotiations and closing the deal.The finer points of a deal are defined in a Purchase and Sale (P&S) agreement. The buyer will want to visit your facilities and may request confidential interviews with selected employees, customers and vendors. Post-acquisition planning is often a major component of sale negotiations, expecially with a strategic buyer. Buyers often have final due diligence questions that need to be addressed while attorneys prepare the closing documents. Finally, closing documents are signed and money is transferred. Congratulations, you’ve sold your company!
Post-acquisition integration.An important phase begins after the closing celebration. Organizational and business process integration begins. Employees, customers and suppliers must be informed. Whether you're transitioning your responsibilities to a replacement team or settling into a new, long-term position in the buyer's organization, there will be challenges. You won’t hear a lot about the post-acquisition phase from traditional business intermediaries because they tend to disappear after the closing. This is one more way in which Venture 7 Advisors is different. As consultants, we’ve successfully integrated the business operations of small, privately held businesses and multi-billion dollar global companies. We know how to anticipate and manage the challenges of integrating operations and merging brands. We work with our clients to implement a smooth transition and to make sure that your financial and non-financial acquisition goals are achieved.