Getting Ready to Sell a Business? Tell a Good Story, with Narrative and Numbers
October 27, 2017
Wanting to sell a business isn’t the same as being ready to sell a business.
The more time you invest in acquisition preparation, the more likely you are to pull off a lucrative deal without a hitch. Knowing what excites — and turns off — buyers is essential.
And knowing how to communicate it will set you apart.
Tell a Story
As a seller, you need to spur a prospective buyer into taking action. During your initial transaction conversations, take on the role of storyteller — crafting an exciting tale to capture the buyer’s attention.
Tap into what spurred your company’s creation or growth, the values and intent behind its success.
- What does this company do that nobody else can do – what makes it special?
- Consider what motivated your founder, and how did that get you to this negotiating table?
- Make it clear that your company’s unique value complements your target audience from a geographic, product or service perspective.
Show why customers buy from you and where your business stands in the market. And understand where your cost structure is relative to others in the sector.
Remember that stories bring about emotional reactions and connections. They show enthusiasm and insight. They make it easy for buyers to see your vision clearly — why they should proceed.
Mind Your Due Diligence
But a powerful story is hollow without the financials to back it up.
A sure-fire way to frustrate buyers — and perhaps even kill a potential deal — is to show a lack of preparedness and conflicting data.
- Is the financial information you’re presenting different from your operating data?
- Are you providing a basic list of employees that specifies pay rates and hire dates — when what the buyer really wants to see is payroll costs at a product level?
- Do the numbers give a buyer a clear view of your company’s cost structure on a product basis or plant basis?
Provide everything potential buyers ask for, even if you don’t see why it’s important. When you present, don’t let them be confused by any conflicts or holes.
Edit your presentation beforehand, and anticipate their questions.
The bottom line: Make it easy for those doing the due diligence. You don’t have to re-create data, but you should organize it in a compelling, clear manner.
If you set out with proper due diligence at the beginning, then combine your numbers and a narrative, and you’ll make your business irresistible to potential buyers.