Getting Acquired: Practical Guidance from an Industry Professional - with Zach Vaninger (Part 2)
Firing The Man · with Zach Vaninger · July 7, 2020 · 36 min
Summary
This episode offers a practical guide for ecommerce business owners considering an acquisition. It details common pitfalls that can kill a deal, strategies to enhance company value before a sale, and the critical importance of preparedness and realistic expectations throughout the M&A process. Learn how to navigate due diligence, avoid negotiation missteps, and identify viable buyers to successfully sell your business.
Key takeaways
Expedite the transaction process: The longer a deal drags on, the higher the risk of external factors (like market downturns or inventory issues) or internal problems derailing it. Aim for a quick, efficient sale.
Prioritize quick and accurate information: Be prepared to provide detailed, timely responses to due diligence requests. Slow or generic replies create uncertainty and can deter buyers. Consider delegating daily tasks to free up time for the sale process.
Set realistic valuation expectations: Understand that buyers use specific industry valuation models (e.g., EBITDA or SDE multiples). Avoid overvaluing your business based on emotional attachment or general market intelligence; seek expert advice.
Be emotionally ready for the sale: Selling a business can be a highly emotional process. Ensure you are prepared to commit to the lengthy and potentially taxing process, and be ready to let go when an acceptable offer is made.
Address potential deal killers proactively: Be aware of issues like revenue drops, slow responses, inaccurate information, unrealistic seller expectations, over-negotiation, and buyer-side approval hurdles. Proactive preparation can mitigate these risks.
Episode 28 This episode is part 2 of 2, where we are joined by Mergers & Acquisitions specialist - Zach Vaninger. Zach has spent a majority of his career in the world of Mergers and Acquisitions and has worked on transactions that total over $1 billion in deal value. On today’s episode, Zach is going to share his thoughts on what a seller can do to prepare to get acquired and walk us through the process of selling a company. Things that can kill a deal Seller’s ...
What does this episode say about finance & fundraising?
Expedite the transaction process: The longer a deal drags on, the higher the risk of external factors (like market downturns or inventory issues) or internal problems derailing it. Aim for a quick, efficient sale.
What does this episode say about founder & leadership?
Prioritize quick and accurate information: Be prepared to provide detailed, timely responses to due diligence requests. Slow or generic replies create uncertainty and can deter buyers. Consider delegating daily tasks to free up time for the sale process.
What does this episode say about supply chain & operations?
Set realistic valuation expectations: Understand that buyers use specific industry valuation models (e.g., EBITDA or SDE multiples). Avoid overvaluing your business based on emotional attachment or general market intelligence; seek expert advice.
What does this episode say about finance & fundraising?
Be emotionally ready for the sale: Selling a business can be a highly emotional process. Ensure you are prepared to commit to the lengthy and potentially taxing process, and be ready to let go when an acceptable offer is made.
What does this episode say about finance & fundraising?
Address potential deal killers proactively: Be aware of issues like revenue drops, slow responses, inaccurate information, unrealistic seller expectations, over-negotiation, and buyer-side approval hurdles. Proactive preparation can mitigate these risks.
