Business owners are highly strategic. Yet many neglect a key aspect of successful strategy when it comes time to sell their business: hiring a skilled transaction advisor. Investment bankers bring years of experience to the deal table. This can level the playing field, counter experience disparities between a business owner and the prospective buyer, and ultimately add significant value to the deal. A trusted M&A intermediary may be a business owner’s most significant asset at the negotiating table. Here are five key areas where investment bankers can bring real value:
The right M&A advisor is not just a salesperson. They deeply understand the companies they represent and the markets in which they operate, as well as the current macroeconomic climate. Quality investment bankers begin by learning as much as possible about the target company, then making customized recommendations based on what they learn.
A Comprehensive Valuation
A business owner needs to know how much its business is worth, and an advisor can help determine the right formula for estimating value. They can also offer tips for growing value, especially if there is time to prepare. This unbiased valuation can make it much easier to negotiate a final sale price.
Setting Reasonable Expectations
Business owners dedicate much of their lives to their businesses. It’s hard to be objective about something into which they have poured so much of themselves. That’s where an advisor comes in. They help business owners look at their businesses through a more objective lens. This empowers business owners to make good decisions, and makes it less likely that they’ll allow emotions to get in the way of a solid deal.
Offering Useful Financial Advice
The financial aspects of selling your business extend well beyond the final sale price. An advisor can help determine which deal terms are best for the business, and how the structure of the deal may enable a business owner to reach its financial goals. In addition, an advisor can help construct a viable vision for a business owner’s post-business future.
Helping You Negotiate the Deal
Negotiating a deal can take on a life of its own, becoming a full-time job. This makes it difficult to run a company while simultaneously running a sell-side transaction. An advisor takes over negotiations on behalf of a business owner, lending credibility to the deal and ensuring the business owner is not taken advantage of.
About Madison Street Capital
Madison Street Capital is an international investment banking firm committed to integrity, excellence, leadership and service in delivering corporate financial advisory services to publicly and privately held businesses. Over the years we have helped clients in hundreds of industry verticals reach their goal in a timely manner.
Our experience and understanding in areas of corporate finance and corporate governance is the reason we are a leading provider of financial advisory services, M&A, and valuations. With offices in North America, Asia and Africa, we have adopted a global view that gives equal emphasis to local business relationships and networks.