Why Do I Need a Broker to Sell My Business?
All good things come to an end, and this maxim applies to entrepreneurship as well. Business owners have a diverse number of reasons for wishing to exit. From retirement, a once-in-a-lifetime offer, mounting risks to burnout, it comes a time when selling your business is the best option.
Whatever the motivation behind the business sale, it’s important to get the most value. There are no do-overs once you close the deal.
Now that businesses always come up for sale, an industry of professional business sellers has evolved over the years. These brokers have an intense understanding of the exit process from the business valuation, value drivers, marketing, transactions, documentation, legal procedures, and much more.
After putting in so much into the enterprise, it’s tempting to do everything on your own during the exit event. Many business owners seek to control every aspect of the exit and inevitably mess things up. You have to appreciate that selling a business requires a sustained effort. It is an undertaking that can take months or years. Is this a task you want to take head-on alone?
What Do Brokers Do in a Business Sale?
At this point, you should evaluate what a broker brings to the process. These professionals work mostly on commissions to prepare an in-depth analysis of the business. They also make a detailed marketing strategy and a comprehensive business valuation and exit strategy business plan.
The intermediary consults with you and potential buyers to facilitates the sale. Through their experience, they can guarantee a faster sale and better value from the deal. A good broker works with you over a long period to prepare an exit plan that suits your goals.
Reasons to Use a Broker in a Company Sale
Here are some other reasons to work with a professional business seller in your exit plan.
1. Professional Business Valuation
After working hard to build an enterprise, most entrepreneurs feel they have the expertise required to value the investment. However, such a valuation is from the seller’s point of view and doesn’t count for much. A professional business valuation considers how much the business on sale is worth to the buyer.
A broker has access to methods, tools, and databases that will give the best valuation to come up with an asking price. Some of the methods used in the assessment include market cap, discounted cash flow (DCF) Method, liquidation value, earnings multipliers, and book value.
2. Effective Pricing
After a valuation of your company, there’s a lot of work that goes into setting an asking price. the valuation also considers future earnings prospects, similar company comparisons, among others. With a realistic valuation supported by structured formula, it’s easier to sell your business.
An experienced business broker understands the developments and trends in the market. They know what other similar businesses are on sale or have sold recently. Such considerations help come with effective pricing to help close the deal faster. Effective pricing also guaranteeing the best value for your investment.
3. Business Marketing
If you take your company to market, you have to learn how to everything from the start. While you have successfully built this venture, the task at hand is entirely different. It requires a different set of skills and networks.
Your business broker already knows the tools and platforms to use to target potential buyers. These professionals already have networks they can activate to get the right buyers. When you give the job to a broker, you know they will work extra hard to find the best deal.
4. Confidentiality
Selling a company is different from marketing goods and products. You don’t want to advertise about a business sale because this might create a wrong impression among your customers. The last thing you want is your customers to turn away because they think your business is going down.
Working with a broker creates a buffer between your company and the buyers. There’s always non-disclosure or NDA in these transactions, and the broker enforces the terms. If a buyer only wants general information, your broker sorts them out without revealing details of your business.
5. Hassle-free Business Sale
Many entrepreneurs take it upon themselves to sell their companies without appreciating how involving this process gets. With time, you start losing focus on the core business, which in turn affects the sale. The last thing a buyer wants is to buy a non-performing entity.
A broker can save you a lot of time and stress by managing this sale. Taking on this sale alone can bring your life to a halt due to the time and energy it demands.
6. Structured Exit Plan
If you approach a business sale haphazardly, you might end up getting less than what you deserve from your investment. It is a problem that many business owners encounter because they don’t leverage professional expertise when exiting.
A structured exit plan not only helps with the valuation but also pinpoints value drivers you need to work on. From the systems and procedures, employees, financial data and reporting, prospects, diverse customer base to growth potential, your broker will help make your business more attractive to buyers.
7. Finding the Right Buyer
A broker has the right connections to find the right buyer. With their experience in selling companies, they have collected valuable contacts they can approach for the best deals. If you decide to advertise your company, you have to deal with everyone who sees the advert. It is one reason many small business owners struggle to sell otherwise performing businesses.
Working with a Business Broker
Selling a business is one of the toughest decisions you can make. We understand it has taken sacrifice to get the business where itis. Our mission is to help our clients through this tough process by developing a structured custom exit plan.
We work with you from the moment you contact us to the point of closing the deal. Our team takes time to learn and understand your company, and this helps us work productively with you. From the business valuation to the exit stage, we represent you to guarantee you get the best value for your investment.
Contact us today for a custom exit strategy in your business sale.
Let’s hop on a quick call to discuss the timing and prospects of an exit based on your goals and the current state of your business. Schedule your free exit consultation today.
You're guaranteed to come away from the call with:
Clarity about your business
Knowledge of the landscape
A high-level exit plan
A rough valuation
Actionable insights
Specific next steps
Testimonials
What our clients say
In my career you get to deal with a lot of service providers. There are the below average, the average the the above average. Then there is one category that no one talks about which is the exception. We engaged Hello Exit to source acquisition targets for us. The communication, personal service, attention to details, availability, interaction with the team has been nothing short of exceptional. If ANYONE wants further in-depth conversation about the exceptional experience please reach out.
I worked with Hello Exit for the sale of a business and everything went smoothly. The team was very hands-on and provided a lot of guidance throughout every part of the process. They took the time to get to know my business well and were able to communicate our operation effectively to potential buyers. The sale was a success and I couldn’t have done it without them.
Hello Exit was great working with me to help sell my software company. They made everything clear, were patient, never over pressured me, but kept a strong sense of urgency. I would recommend Hello Exit to anyone looking to sell their business and plan on working with them again in any capacity that I can.
The team Hello Exit is simply incredible! Their expertise and support throughout the entire process of selling my company were a game changer. Their expertise and guidance throughout the entire process was invaluable. They took the time to truly understand my needs and goals, and helped me navigate every step of the way with ease. Hello Exit is exceptional, and they truly go above and beyond to ensure their clients are not only satisfied, but actually excited about their exit!! I cannot recommend Hello Exit enough! Their professionalism, knowledge, and dedication to their clients are unmatched. If you’re looking for a top-notch company to help you sell your business, look no further than Hello Exit. Thank you guys, for all that you do!
It was a pleasure working with Hello Exit and they have my most sincere recommendation. They bring a sophistication and etiquette that is very hard to find in the lower, lower middle market – outstanding preparation, excellent sell-side coaching, a rationale / unbiased disposition, and so on. In addition, they bring a powerful network to the conversation and can add value well beyond the transaction. I hope to work with Hello Exit on many more deals to come!
Hello Exit added tremendous value for our portfolio of companies. They made a complex sale process easier and significantly more efficient. We received 5 offers (two above ask) and were extremely happy with the outcome. As a serial trouble maker that has acquired 7 companies and sold 4 we will be using Hello Exit for future exits.
Hello Exit has built one of the best online business brokerages out there. As a buyer, the company has continuously provided us with acquisition targets that have been very well qualified. Every opportunity has fit directly into the criteria we’ve been looking for which has saved a ton of time on due diligence. If you want to get a jump start on your acquisition pipeline, it’s easy to recommend Hello Exit.
Hello Exit is one of the most knowledgeable business brokerages out there for tech & web businesses. We used they to buy a significant business operated by 15+ employees. Our work in diligence was substantially reduced given the strong & accurate information package he provided. All questions were proactively answered, all supporting data was there and presented in the right format, and everything was accurately represented. This saved us weeks of work! In discussions & negotiations, they played a fair role & helped resolve issues by understanding the issue from the perspective of both buyer & seller. With their knowledge and experience, they were able to make smart suggestions and helped everyone reach a common ground quickly. I would surely work with Hello Exit again. They are super!
What can I say other than Hello Exit delivered on everything they promised… and then some. At first, I didn’t believe it when they said he would sell my agency in a few months. But they were so passionate about working together, a part of me believed they would deliver. And they did. We had 3 offers in 30 days and went under contract with the highest offer. 3 months later we closed on the sale at the price they evaluated us on. During the entire process, their knowledge and experience helped immensely. Any time there was confusion or a hurdle that myself or the buyer had, the team stepped in and smoothed every over. Selling a business is one of the most invigorating yet stressful experience I’ve ever went through and I’m so grateful that I picked the right broker to help me through it. I’d use Hello Exit again in a heartbeat.
The Hello Exit team was great to work with. They helped increase our deal flow with strategic deals. If someone is looking to increase their targeted deal flow I would definitely recommend working with Hello Exit.
Hello Exit was awesome to work with on the deal. They provided great support and advice all through – from initial interest discussions, negotiations, contract closure to execution. They’re very prompt and proactive which sails the deal making through. They also provided great support and mediation help post transition on some key contract payout clauses, which is highly appreciated. I recommend Hello Exit highly to SaaS business owners and entrepreneurs.
I’ve known Dustin (Hello Exit’s Founder) for over 10 years, and actually acquired a SaaS company he founded. I’ve always found Dustin to be extremely sharp, fair and honest, reasonable to deal with, and the kind of person you would want to do business with again in the future (which is rare these days). I’m currently mentoring and incubating over 150 international startup companies, and have already talked with Dustin about bringing Hello Exit into these businesses to broker the exit once they are profitable and solidly into their momentum phase.
Hello Exit is one of the best and most trustworthy SaaS advisories and brokerages in the industry! If you run a SaaS business, and Hello Exit contacts you, you should definitely talk to them! Even if you decide not to sell, it will be a very worthwhile and fruitful conversation.
