Updated: May 17
Many people try to sell their business on their own and while sometimes that may work out, often it doesn't. So here is what a business intermediary is, how to choose one and ultimately what their role can be in the sale of a business.
Probably the most well known intermediary is the business broker. Often they have several “listings” and may be part of a larger network of brokers such as the Business Brokers Network. In the majority of cases their role is simple, list your business on their website and/or their networks listing website, help find a buyer, help put the deal together and then let the attorneys finish it to closing. This is not always the same and obviously some will do more and some will do much less. Sometimes there is a packaging fee or valuation fee along with a success fee.
Many attorneys also perform intermediary services which may mean they have experience in mergers and acquisitions or in negotiating the deal and papering it with the definitive documents.
At ICCG, we pride ourselves on being transaction consultants intermediaries for advisory services. Our role is much like smaller Investment banking firms who help the company ready their business for sale and then literally walk alongside the business owner from start to finish in the selling process. We do an intake interview and then with that information along with in-depth financial assessment we determine along with the Seller a range for the sales price which is both acceptable to them and what we feel the market will bear.
We then put together the marketing materials which are mainly a confidential information memorandum as well as an anonymous one page teaser that we send out to our buyer database. This starts the process of marketing the company in hopes of enticing several interested parties to submit an IOI or Indication of Interest and the choose those who are vetted to attend a virtual Q&A sessions with the owner in hopes of having at least a couple of LOI or Letters of Intent submitted.
Once an LOI is negotiated, accepted and executed, we assist the Seller with the Due Diligence process as well as legal definitive document negotiations.
Our greatest joy is to see an owner of a business they have built receive a fair price for the business and see it pass into the hands of someone who will take care of the team of people who run the business and who will continue to build the legacy of the business that the Seller has spent years creating.
I have known many people who have tried to sell their own business and I wholeheartedly believe that an experienced business intermediary will not only pay for themselves but will in most cases net the Seller more than they would have if they had sold the business themselves.