Handling an approach from a potential acquirer
Even if you are not looking to sell, as a consulting business owner you should know what to do (and what not to do) if a buyer were to get in touch with you. Because how you respond dramatically affects your potential value should you choose to take the conversation all the way to a sale.
Bruce Ramsay has spent the last 12 years in M&A in the consulting sector, most recently focusing on transactions of businesses under £10million. His webinar for The Consultancy Growth Network helped our members understand why they mustn’t give too much away early on in a sale process, and how they can best demonstrate their value to a buyer right from the start of any new conversation.
Stay in the driver’s seat
Bruce explained that, as the owner of your consulting business, your initial response to an approach from a potential acquirer will depend on the combination of their aspirations and where you are on your growth journey. He then went on to share how to control and use your own data to present your business in the best possible light. This included stopping yourselves from sending information too soon.
You decide what you’re worth – at least to begin with
Conversations with buyers do not need to be one-sided.
Bruce was clear that you need to be clear about what you bring to the acquirer because it contextualises what you are worth to them. “Be explicit about not just your business, but what your business is worth to the buyer,” explained Bruce. “For example, demonstrate how your business will support their growth ambitions.”
“It’s also important that you don’t leave it to the buyer to work out what you’re worth” added Bruce. “Help them to do it, and quantify it.” He went on to talk through transactions he is currently working on to demonstrate the practical applications of this.
Bruce finished with some sound advice about the level of understanding of deal structures you should expect to have.
Bruce’s session was incredibly practical, and one our members will no doubt return to should they get that call or email from a possible buyer.
After the event, one member said: “That was superb, Bruce. A great illustration of the value of being in this network. Thank you.”
If you would like to join our next webinar and you are not a member of the network, try us out by visiting Upcoming events and registering for you’re a free event. If you would like to join us and scale up your business, Become a member or contact George to find out more. We’d love to welcome you to our community.
Article | Strategy and leadership
Ali El Moghraby
Head of Marketing
The Consultancy Growth Network