01 Dec Around the Web: A Week in Summary
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A recent article from Entrepreneur entitled “How to Craft the Ideal Exit of Your Business” discusses how a business went from crisis to successful sale. This business lost a major client that made up a third of the company’s revenue. How the business reacted made a huge difference.
The business created and implemented a 3-year plan that focused on growth and generating value. By cleaning up the business, focusing on core business goals, and adapting a growth mindset throughout the company, the business became more appealing to buyers.
When it came time to exit, the decision was made based on the needs of the business. In order to continue its growth mission, the business needed capital and a strategic partner. When choosing a buyer, cultural and organizational fit were prioritized.
A recent article from Divestopedia entitled “Choosing Between Strategic Buyers or Private Equity” discusses important considerations when selecting a buyer for your business. Strategic buyers and private equity buyers come with their own unique objectives which can impact the deal and the business.
A strategic buyer is seeking to acquire a company to enhance their existing business. A financial buyer (typically a private equity firm) is seeking to acquire a company for its growth potential as a standalone investment.
It’s important to consider the deal structure, due diligence requirements, investment criteria, transaction history, vision, culture, management and the future of the business.
A recent article from Exit Strategies Group entitled “Entrepreneurs really do think of business as their baby” discusses the reality that business owners think of their business as their child. When it comes time to sell, it can be very emotional.
Owners may struggle with issues such as:
- Letting go of the business
- Being too proud to acknowledge company weaknesses
- Losing sleep due to concern over making the right decision
- Prioritizing legacy vs. money