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What Happened

A couple of weeks passed with no word from the PE firm. Bruce called me again and I could tell his excitement was turning to annoyance.

At that point, Bruce retained me to officially represent him in the negotiation. This was June 2022.

The buyer was simultaneously working on three other transactions, so the terms of their offer were to close the acquisition of Bruce’s deal in mid-Q1 2023.

Thanksgiving 2022 came and went without a word from the buyer. I called the buyer in early December, and he explained getting the other deals closed had taken more time than they had hoped.

The revised offer had the same valuation, but the terms were dramatically different. We went from 80% cash/20% rollover to 55% cash/25% rollover/20% earn out.

While valuations aren’t being dinged yet, buyers are stingy with how they’ll release cash. But like all trauma, this too shall pass.

What Happened?

The offer was not expected. Bruce (not his real name) was surprised when he got a call from a respected private equity (PE) professional asking if he could fly from Chicago to have lunch. “If he wants to fly down just for lunch, I thought I should hear what he had in mind,” Bruce told me during our first phone call. As it turns out, the PE guy’s firm already owned a company in St. Louis much like Bruce’s, and the PE Read More

One Thoughtless Comment Cost Him $35 Million

Don (not his real name) was smart, but his errant comment cost him $35 million. In just 12 years, he had built his company to be the largest in his industry. Don was a rock star, and his company’s future was bright. But Don had taken the company as far as he wanted to take it. Though just 44 years old, he was ready to sell the company and realize his life’s ambition to play golf on six continents (did you know, there Read More

Success is Hard

“It is a big idea and takes us in a whole new direction. Only a few companies in the entire country are doing it, we must go for it!” Jordan (not her real name) was darn near breathless as we talked about her business plan. She retained me a few weeks earlier to help her think through expansion options, ranging from raising third-party capital, giving key employees equity instead of compensation, or selling the Read More

When the Divorce Lawyer Isn’t the Right Kind

“He got me through an awful divorce, so Bart [not his real name] is the lawyer I want by my side through this negotiation.”  Bobby (not his real name) is selling his company to a private equity (PE) group that is rolling up companies in his industry. He told me he had one shot to make this work. “If they didn’t buy my company, they were going to buy my competitor, and that would have put me in a tough spot.” Bobby Read More

Code Words You Hear When the Business Owner Needs Hospice, Not a Broker

People know when it’s time to call the undertaker. The signs are obvious. Though it’s an exceedingly painful task, we confront the difficult circumstances because we know we have no choice. It’s less obvious to know when to call hospice, that awful time when you recognize the patient is likely to die and needs comfort. It’s a hard thing to see, much less admit. It should therefore not be surprising that most business Read More

My Business is Hot!

“They have been hounding me for months, they say my business is hot, and they really want to be in Nashville.” Sarah (not her real name) has paid her dues for over 25 years. She is being courted by a national competitor who wants to move into Nashville by acquiring her business. “I’d sure rather sell to them than compete against them,” she recently told me over lunch. “After doing this for two decades, I’m ready to Read More

Three Reasons Why Overpaying Might Actually Make Sense

Last year I was engaged to sell a profitable Kentucky-based business. The owner was ready to retire but was fully committed to helping the buyer make a smooth transition. The 50-year-old business had a positive reputation in the community, a loyal customer base, and a great location. I located a prospective buyer through a referral from a banker, and once I showed this prospect my client’s business, he was soon Read More

Time to Look in the Mirror

There are times when some conversations are very difficult. Such was the case when I sat down with Ryan (not his real name). He summed up our meeting saying this, “I guess it’s time I look in the mirror and tell myself the truth. I’ve done a lot of work in this business but don’t have much to show for it.”  Ryan and I were meeting to review the valuation report I prepared for him. Though his business had revenue of Read More

The 3 to 4 in 5 to 6 Flip

“I want to sell my company in 2023. I’ve loved being a business owner for 25 years, but I’m ready to enjoy my harvest and let somebody else take it from here. But no way in hell do I want to sell to private equity.” Stan (not his real name) is looking at an eight-figure payday when his company is sold. Given the state of the market and the tip-top shape by which he has run his business, we will likely have a deal Read More

Divorce is Easier

“I love my wife dearly, I know we will never think about divorce, but that would be easier than ending this business relationship.” I felt sorry for Madison and his business partner Wendall (not their real names). Successful in business for over 25 years, they are now at an impasse that doesn’t have an easy solution. Madison wants out of the business so he can pursue his calling to foreign missions with his church. Read More