I believe that brokers who tend to keep buyers and sellers separate waste a lot of time and energy. Our position is that a 30-minute get-to-know-you call is an important step in determining whether this deal will happen, so we make sure it happens early in the process. Here are some tips I give to sellers to prepare for the call:
This first call is about a high-level discussion of the business, not detailed discovery. The buyer has already received a summary of the company and the financials in the Confidential Information Memorandum (CIM), so they have a pretty good idea that the company is worth pursuing. We wouldn’t put the buyer and seller together unless we thought it was a viable match.
We always start the conversation with a couple of minutes of introductions: the seller gives an overview of how the business got started and how it’s grown, and shares some information about their background, experience, and why they’re interested in buying this company at this time. After 30 minutes on the phone, the two parties have a sense of whether the deal is a good fit. If the answer is “no” for either party, we’ve saved everyone a lot of time and effort.
You’re not on the call to sell the business. It’s a good thing to be proud of what you’ve built, but the buyer wouldn’t be on the call if they weren’t already interested. I advise sellers to be the best version of themselves and not to take any questions personally. It’s easy to get defensive when someone asks why you made a decision or chose a specific strategy. But if you put yourself in their shoes, you’d be curious about the same things. It is what it is, and the buyer will either move forward or move on. But there’s no need to cover up or change the facts; everything will come to light eventually.
You are on the call to talk about the most important issue: why are you selling, and selling right now? We always encourage sellers to think through their story – the narrative they want buyers to hear. If you’re ready for retirement, feeling like you don’t have enough gas in the tank to run the company, or just moving toward the next phase in your life, be up front about it. Even though you’re “not on the call to sell the business,” the buyer will want to know why you’re ready to walk away from a profitable and growing company. That’s a natural question to ask, and you should craft a thoughtful and honest answer for them.
Don’t try to win the conversation. The best deals are those where everyone walks away feeling like they got a good deal and made a couple of concessions. If a buyer starts questioning or negotiating price on the first call, we’ll intervene. If a seller starts overselling or justifying their decisions, we’ll try to steer them toward a more productive direction.
The real purpose of the first conversation is to determine whether the two parties should continue. If they don’t have confidence in each other’s integrity, competence, or transparency, the deal is not likely to go through. I encourage sellers to use their common sense and business instincts to figure out if the buyer is someone they want to do business with, and someone who will succeed in running the company.
Remember that this is a marriage, not a divorce negotiation. Working with an experienced broker means you know the buyer is serious and has the means to make an offer. You won’t be wasting time with tire-kickers or people who are not qualified to buy or run the business. It’s also important to keep an open mind about who the “ideal” buyer would be; I always ask sellers to take a call with a qualified and motivated buyer, even if they don’t fit the ideal profile. If they have the means to buy and the business sense to run the company, it’s worth the time to get to know them before rejecting them as a prospect. Sometimes, your ideal buyer may not bring the best offer to the table; terms matter as much as the asking price or industry experience.
A 30-minute call will make it easier to know if a buyer is the right one for you. If I can help you understand the value of your business in today’s market, let’s connect here.
