Selling a Business Is a Lot Like Looking for Love: You Have to Kiss a Lot of Frogs
I sold several businesses after running them for many years. I now help other business owners find the right buyers for their companies. Finding the right buyer is a daunting process, not unlike finding love. I know a little something about that as well. I found myself single after 25 years of marriage and re-entered the dating marketplace. I found the perfect match after a lot of dates. There are some remarkable similarities between selling a business and looking for love. In both cases, you have to kiss a lot of frogs.
So, for you business owners thinking about entering the dating marketplace for your business, I offer these tips for kissing the frogs and courting the right buyers who will fall in love with your business:
The Players – these suitors love the chase and romance of buying a business, but have no serious intention of committing to one. They are attractive and sexy and know exactly what to say. They get off on sweeping business owners off their feet. They like to think of themselves as master acquirers. They will toy with you as long as you allow them to do so.
If you don’t want to find yourself on an endless number of dates and empty promises, call their bluff and move on quickly.
The Pretenders – these suitors are already married. They are not in search of a new, long-term relationship. They are feigning affection and pretending to be interested in a relationship for other reasons. They have a hidden agenda. They are looking for competitive intelligence. They are doing research and you are merely a data point. They are assembling comparables and multiples to aid their own company sale or to resell data to others.
If you don’t want to spend your time informing and educating a competitive business that might use your proprietary information against you, tell them to take a hike.
The Liars – these suitors will tell you anything you want to hear. There is an old, tried and true saying among business brokers: “Buyers are liars.” They will misrepresent their background and financial capability to buy your business. They will stall and obfuscate and go completely dark for weeks on end. They will feign righteous indignation when you call them on their lies and misrepresentations.
If you don’t want to get dragged into their seedy game, just say “bye bye.”
The Gold Diggers – these suitors are looking to mine your business. They either want to milk it or flip it. They want an instant source of revenue without putting up any money, or very little money. They will want you to finance their acquisition with no intention of making good on the loan or earn out.
If you don’t want to turn the keys over to someone who will rape and pillage your business, then not pay you for it, steer clear.
The Bored or Lonely – these suitors will give you plenty of attention and they will want lots of your attention in return. They will talk and talk, wine and dine, prod and discuss ad nauseam. They are suitors who previously sold a business or are semi-retired after long careers and now want to get back into the “game.” They don’t really have any idea what they want, but they will be happy to waste your time trying to figure it out.
If you don’t want to waste your time while they try to figure it out, tell them to come back when they do.
The Serious, Authentic, and Thoughtful – these suitors are worthy of multiple dates. They may not be right for you, or you for them, but you will both know where you stand and can decide quickly whether a long-term relationship is possible. You both want the same thing, but might not be quite sure whether it is with each other. The mutual chemistry and shared goals and aspirations will be aligned, or they won’t be, as you both do your due diligence.
Give these suitors fair consideration. Just don’t try to force it because these suitors look so much better than the other types of suitors encountered above.
Looking for Love in All the Wrong Places
The odds of the ideal “partner” walking into your door are slim to none. You have to put yourself out there. Anyone who has dated or sold a business knows you have to cast a wide net. This means listing on multiple platforms. Don’t just rely on BizBuySell – the Tinder of the business brokerage industry. Get listed on the more serious platforms, especially those targeted to the type of buyer you are looking for. It also helps to retain a matchmaker – a good business broker or M&A intermediary. For more info on marketing your business, see my post, “If you want to Buy or Sell a Business, You Have to Know How to Fish.”
Breaking Up Is Hard to Do
If you are serious about finding love with the right buyer, you will likely end up engaged (or at least going steady). Be prepared for the relationship not to work out. It happens a lot when selling a business. As hard as it is, sometimes you have to walk away. As much as you want it to work out, it might not be meant to be. Dress up and get back out there. Don’t fret, don’t settle, true love is just around the corner.
When selling a business, be prepared to kiss a lot of frogs. Your Prince or Princess is out there somewhere. Put yourself in a better position to find him or her. May you find “true love” for yourself and your business!