You don’t run your business alone, don’t try to sell it alone.
Every established business has a complex web of obligations, needs, and relationships. An important part of any business owner’s team is professional advisors with specialized knowledge.
We recommend the same approach when buying or selling a business - develop a committed team with the specialized experience you need to navigate the business sale/acquisition process. Buying or selling a business touches on areas of law, tax, and business that are outside your expertise. Decisions made about these areas can have a lasting impact on your business. So, if you’re tempted to put it all on your shoulders, remember: there are no prizes for going it alone, but there are some real detriments to missing out on the expertise and perspective of an experienced team.
It’s never too early to get started. If you’re years from buying or selling, that’s great — you’ve got the luxury of time to meet and evaluate various professionals to see if you’re compatible. If you’re looking to buy or sell near term, it’s time to get cracking - you need to put together a team you can count on to help you through a complex and challenging time.
Here are a few reasons you should consult with outside experts when buying or selling a business, even for tasks you’ve been doing on your own.
Honest assessment of your business blind spots
As a business owner, you can have unrealistic perspectives and expectations. You’ve figured out what works for you in your business, you drive the agenda, and you’ve got a lot of people telling you yes. But there is no all-knowing, all seeing business owner. Every business owner has areas where he or she needs advice. Legal is one of them. We went to law school to learn this, and have years of experience. Often, our buyers and sellers are doing deals for the first time. Even if it’s the 10th time, our experience and understand of the legal technicalities and tools is critical in the deal process. An honest assessment of your own skills, and those of your management team, will allow you to bring on additional specialist to fill in any gaps. Outside advisors like experienced attorneys or business consultants can help evaluate whether additional team members would bring value to your business.
Use their credibility/Network
It’s a big world and while you may be the name on the door of your company, M&A professionals likely don’t know you. You will be taken more seriously (and important doors may open faster) if you have the additional credibility of a group of reputable professionals. Additionally, part of what you get when you hire a professional is access to the people they know and trust in the deal process. This equates to peace of mind and time saved in searching, interviewing, etc.
Free up your attention to do business.
No matter how knowledgeable and experienced you are, there’s are only so many hours in a day — and your main task is to run your business. A team of professionals mitigates your opportunity costs, and keeps your time and attention free to apply to the places where you are most valuable.
Use their insurance
Along with specialized knowledge and experience, professionals often carry insurance coverage to cover mistakes or errors in their advice. The financial stakes in business transactions are often higher than an individual can reasonably address, so it can be a benefit to both sides that there are insurance policies addressing mistakes made in the process. It’s always best to get quality professional advice and assistance, and that is what usually happens, but it is good to be able to access insurance in the rare instances when there is a problem.
You’re not alone.
Think of your advisors as board that surrounds and supports you through the transaction. These are the people who counsel you through the challenges, advocate for your best interest, and celebrate your wins. When you build an experienced team you can trust, you have the resources you need to achieve your goals with your business, whether you’re looking to expand or sell and retire.
For some helpful information on interviewing and selecting your team, check out our guide on putting together your deal team.Whether you’re looking to sell soon, or just want to chat about the process of buying or selling a business, feel free to contact us to get started assembling your deal team. If you’re not ready for that, we invite you to continue watching this space for more helpful information on buying and selling small businesses.