Getting Acquired: Practical Guidance from an Industry Professional - with Zach Vaninger (Part 2)

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Jul 07 2020 33 mins  

Episode 28

This episode is part 2 of 2, where we are joined by Mergers & Acquisitions specialist - Zach Vaninger.  Zach has spent a majority of his career in the world of Mergers and Acquisitions and has worked on transactions that total over $1 billion in deal value.  On today’s episode, Zach is going to share his thoughts on what a seller can do to prepare to get acquired and walk us through the process of selling a company.  

Things that can kill a deal

  • Seller’s revenue and/or profits drop while in the market, or worse, during due diligence.
  • Due Diligence Surprises.
  • Slow Responses.
  • Inaccurate Information.
  • Unrealistic Expectations.
  • Over-Negotiating.
  • Buyer Issues.
  • Outside Market Issues.
  • Partner/Stakeholder Disputes.
  • Not Ready Emotionally.

Strategic vs. Financial Buyers

  • Strategic
    • Strategic buyers are operating companies that are often competitors, suppliers, or customers of your firm. Their goal is to identify companies whose products or services can synergistically integrate with their existing P/L to create incremental, long-term shareholder value. In other words, their primary incentive for the acquisition is strategic, hence the moniker. These buyers can also be unrelated to your company and looking to grow in your market to diversify their revenue sources.
  • Financial
    • Financial buyers include private equity firms (also known as “financial sponsors”), venture capital firms, hedge funds, family offices, and high net worth individuals. These firms and executives are in the business of making investments in companies and realizing a return on their investments within 5-7 years with a sale or an IPO.

5 ways to find promising strategic buyers

  • Exhaust (And Don’t Miss) the Obvious Buyers
  • Think Outside the Box
  • Find the Active Buyers
  • Verify Ability to Execute
  • Stretch the Geography


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