Confessions of a Do-It-Yourself Business Seller
How selling his company on his own stole some of this business owner’s joy – and financial gain – from what should have been his crowning achievement.
All M&A transactions have one thing in common - they require the business owner/s to divulge information that is highly confidential and imperative to the success of the business - an action that is often counter to the normal course of business. In the wrong hands, this type of information can be seriously detrimental to operations moving forward, particularly tightly knit business communities or industries with new major competitors - much like markets we serve in Colorado, Arizona and Oklahoma. The way to ensure that a situation like this does not occur is to execute a Nondisclosure Agreement (NDA), which binds the party receiving the information to keeping all data confidential and not sharing with anyone outside of his or her operation. Still, even an executed NDA leaves your business somewhat exposed as not all buyers adhere to all the covenants of the document. Unfortunately, this is a reality that business owners must grapple with, after all no savvy buyer will purchase without the needed confidential information.
Understanding your potential exposure and having a realistic expectation of what confidentiality really is in the context of a business sale will better prepare you for a successful business sale.
How selling his company on his own stole some of this business owner’s joy – and financial gain – from what should have been his crowning achievement.
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