Useful excerpts from a Smith & Williamson ‘managing your exit’ workshop I was at last week, targeted at owners looking to sell their business. We talked a lot about a clear vision, and a storyboard, and giving the buyer permission to buy. 

Never tell anyone the value of your business - Stating a value puts a ceiling on the price. The owner can walk in and announce “I’m not taking less that £10M” just as the buyer is poised to offer £30M! 

Plan that all your weaknesses will be discovered by due diligence - It can even pay off to be upfront about any problems, to avoid them being used as a bargaining tool later on. 

Ignore the averages, focus on what’s special about your business  - because averages are just averages!

avoid exclusivity as long as possible - speaks for itself, competition raises the price.

keep a dataroom prepared and running all the time - not just a last minute rush (and yes, they really said this, it wasn’t just me!)

Golden Rules for the exit

• Control your exit
• identify strategic value - do you know what you’re selling? You need a storyboard and a vision
• design and manage a sales process
• ensure the business keeps delivering (whilst your management teams attention is elsewhere!)
    

You must own

•  route to market
•  your customer
•  brand

how to minimise fee’s

•  Agree commercials with a solid heads of agreement before engaging lawyers
•  Minimise lawyers and accountants fees by being well  prepared
•  Ask the lawyers for a cap fee, and a drop dead fee - if they won’t do it, find another laywer