How to prepare sellers for an M&A emotional rollercoaster

One of the best pieces of advice on buying companies I've ever received is to use a "True/False" checklist in evaluating potential targets. As a business buyer you need to quickly qualify and decide if a business is worth pursuing or not - time is a scare resource you can't afford to waste. Consider the difference between these two approaches to evaluating a target company: Version A: Scorecard Model - EBITDA: 3 - Industry: 2 - Location: 2 - Gross Profit Margin: 4 - Depth of Management: 2 - Customer Concentration: 5 - Revenue Quality: 1 Result: ??? Version B: Binary Model - EBITDA: True - Industry: True - Location: True - Gross Profit Margin: True - Depth of Management: True - Customer Concentration: True - Revenue Quality: False Result: Don't pursue Version A = shades of grey. You have to give your criteria different weights (challenging) and then estimate the relative strength of those factors in the target you're evaluating (also challenging). Version B = black and white. You either want to pursue it or you don't. Yes, there's still nuance in the traits, and what is "True" in Deal 1 might be slightly less "True" in Deal 2, but now you have clarity on whether or not to pursue. If you're optimizing for getting a deal done, Version B makes the qualification process far easier. Credit to Jim Vesterman - who had an incredibly successful exit and teaches a search fund class at Wharton - who was kind enough to share this wisdom with me early in my search journey. #eta #acquisitions #entrepreneur

What’s the key to scaling your business without relying on external partnerships or acquisitions? Aoife Farmer’s article in Oppizi highlights how businesses can use a mix of organic and inorganic strategies to achieve sustainable growth. From market development to product innovation, the right approach can propel your company forward. How has your business used internal strategies to drive growth? https://lnkd.in/e6k8XJFM

Is it possible to let people go with grace? As a business owner and founder, reductions in force might be one of the most agonizing things to go through. It often happens when the company isn’t doing well and also when it goes through a major transition, e.g. being bought over by another company. Here’s 3 things I’ve learned about letting people go with grace during an acquisition: 1. 𝐒𝐭𝐚𝐫𝐭 𝐰𝐢𝐭𝐡 𝐚𝐜𝐤𝐧𝐨𝐰𝐥𝐞𝐝𝐠𝐞𝐦𝐞𝐧𝐭, 𝐧𝐨𝐭 𝐣𝐮𝐬𝐭 𝐬𝐞𝐯𝐞𝐫𝐚𝐧𝐜𝐞 When acquiring a new company, the people you inherit aren’t just ‘headcount’. They’re the reason the company was valuable enough to buy in the first place! So before making any decisions, I would sit down with each person and ask: ❓ What do you do here? ❓ What do you love about your role? ❓ How have you contributed? These conversions are where the real gold is unearthed. I remember how during one acquisition, we discussed someone who was close to retirement and another, who had skills that we didn’t know existed but would be critical for where we were thinking of directing the company towards! 2. 𝐏𝐫𝐨𝐯𝐢𝐝𝐞 𝐫𝐞𝐚𝐥 𝐫𝐮𝐧𝐰𝐚𝐲, 𝐧𝐨𝐭 𝐣𝐮𝐬𝐭 𝐚 𝐭𝐨𝐤𝐞𝐧 𝐩𝐚𝐜𝐤𝐚𝐠𝐞 When you eliminate someone's role through an acquisition, you're forcing them to "clock out" - whether they're ready or not. They didn't choose this moment. You did. So give them enough severance to breathe, think and find their next opportunity without panic. It’s the least that we can do to show respect for the work they put in to build something worth buying. 3. 𝐇𝐞𝐥𝐩 𝐭𝐡𝐞𝐦 𝐫𝐞𝐝𝐞𝐩𝐥𝐨𝐲 𝐭𝐡𝐞𝐢𝐫 𝐬𝐤𝐢𝐥𝐥𝐬 We live in a skills economy now. Many of the people impacted by a merger or acquisition have valuable transferable skills - design, marketing, operations, client management - that can serve them well elsewhere. Part of letting people go with grace is helping them see their own potential beyond the role they’re leaving. Sometimes that means introducing them to networks, recruiters, or career transition partners. Other times, it simply means having the conversation that reminds them: “𝘠𝘰𝘶 𝘩𝘢𝘷𝘦 𝘴𝘰𝘮𝘦𝘵𝘩𝘪𝘯𝘨 𝘷𝘢𝘭𝘶𝘢𝘣𝘭𝘦 𝘵𝘰 𝘰𝘧𝘧𝘦𝘳. 𝘛𝘩𝘪𝘴 𝘪𝘴𝘯’𝘵 𝘵𝘩𝘦 𝘦𝘯𝘥.” * Every acquisition brings tough decisions but those tough decisions can still be made with grace. It’s not just the right thing to do. It’s good business too. ♻️ Reshare this post if it resonates. 🔔 Follow me Raymond for more insights on acquisitions, entrepreneurship, and doing business with integrity - posted every Tuesday and Friday.

Well said Raymond Lee. I have observed that "HOW" leaders deliver restructure/downsizing messages is based on the leader's core leadership style. In other words, some do it well; while others do not, and probably never will (even with coaching/training).

For high-level professionals, the most significant financial misstep is confusing career advancement with wealth creation. The real leverage lies in monetizing your core competencies outside of a single employment contract—becoming a Fractional Operator. Stop chasing low-leverage "passive income" schemes or expensive, time-consuming business acquisitions. Use the SPAR framework: directly engage your network to identify their ROI-heavy problems, and sign 2-3 clients to immediately generate 6 figures of supplemental income. Your greatest asset is your existing, validated professional expertise. #LeadershipDevelopment #Entrepreneurship #FractionalWork #BusinessStrategy #SideHustle #SyedDigital

Why Merge With or Buy Your Competitors? - the end Most entrepreneurs think growth only comes from selling more. But sometimes the fastest way forward is to merge with or buy out your rivals. In summary of the topic today, here are 7 reasons why it works: Fast Growth - you scale overnight. Staff Access - acquire trained people instead of hiring from scratch. Skills Boost - add expertise at director or shareholder level. Premises Advantage - gain their locations without new leases. Remove Competition - eliminate rivals while absorbing their strengths. EBITDA Growth - profits rise through added revenue and cost savings. Recurring Income - contracts and customers lock in new cash flow. Which of these seven would make the biggest difference in your sector? The truth is buyers pay more for businesses that already dominate their market. Merging or buying out competitors is often the hidden lever that creates that dominance. And if you missed them earlier today, check out my posts on recurring revenue - the loophole, the reality check, and the alternative play. Together, they show why small shifts in your model can add millions at exit. #BusinessValuation #ExitStrategy #SMEgrowth #Mergers #Entrepreneurship

Here's the thing: I sit with owners who say, “I don’t know what my business is worth,” or “I wouldn’t even know where to find a buyer.” I get it, I hear you. That uncertainty is exactly why preparation beats timing. Where exits go sideways (and how to actually fix it): Financials: Normalize earnings, clean up add-backs, and present transparent reports buyers can trust. Operations: Document processes so the business isn’t just in the owner’s head but runs without them. People: Identify key roles, succession risks, and retention levers so the team stays solid through transition. Map your buyer universe early. For some companies it’s a strategic competitor or supplier. For others, a private equity bolt-on. Sometimes it’s an internal successor. When you define the buyer set upfront, the process stops feeling like shouting into the void. The payoff? A smoother sale, fewer surprises, stronger multiples, and the confidence that you didn’t leave money on the table. If you’re a Colorado owner curious what your business might be worth (or what’s holding its value back), message me and I’ll share how we walk owners through that first step. #BusinessValuation #MergersAndAcquisitions #SuccessionPlanning #Entrepreneurship #ColoradoBusiness

The 4 People Every Business Absolutely Needs (Trust Us, We Tested This) At Decided Acquisitions Group, we’ve discovered the secret formula for building a company: It’s not funding. It’s not strategy. It’s four very specific types of chaos disguised as people. Here’s who you actually need on your team: 1. The “Why Are We Doing This?” Person Nicholas Halligan – COO Every business needs one person whose full-time job is reminding everyone that most things are, in fact, terrible ideas. That’s Nicholas. While we’re celebrating new deals, he’s in the corner muttering things like, “Do we even have insurance for that?” He’s the human seatbelt keeping this operation from flying straight into a financial ditch. 2. The “I’ve Got a Truck” Person Anthony Halligan – CAO You can’t run a real estate company without that one guy with a truck. Anthony’s the guy who somehow knows exactly where to find a ratchet strap, a crowbar, and a half-used roll of caution tape. When something needs to be moved, he’s already backing up with the tailgate down. Forget spreadsheets — he’s the real asset on wheels! 3. The “Everything’s Gonna Be Amazing!” Person Jonathan Norton – CEO Every team has that one wildly optimistic leader who thinks every deal is “the one.” That’s Jonathan. Roof collapsed? “Open concept!” Mold issue? “Natural insulation!” He believes in miracles — and somehow, he’s usually right. (Eventually.) 4. The “When We’re Rich…” Person Joshua Williams – CRO Joshua’s the guy keeping morale high by constantly planning our future riches. He’ll be knee-deep in drywall dust saying, “When we’re rich, I’m buying a boat... for meetings.” He’s delusional... and the exact reminder we need that the grind’s worth it — even if we’re still waiting on the boat. The TAKEAWAY: If you’re starting a business, make sure you’ve got: - A SKEPTIC to keep you grounded, - A TRUCK to keep you moving, - A DREAMER to keep you inspired - A DELUSIONAL OPTIMIST to keep you from quitting. That’s what a partnership looks like. That’s Decided Acquisitions Group

Buying a book of business doesn’t solve a growth problem, it often exposes one. This is an excellent article by Joe Millott, CFA that highlights an important truth. Growing an effective wealth management business is not as simple as buying another book. Too often, acquisitions are seen as shortcuts to growth. As Joe points out, acquisitions by firms without strong foundations can actually magnify the problems they were hoping to solve. Sustainable growth comes from capability, people, process, and a client experience that creates ongoing momentum. Even with all the right pieces, inorganic growth on its own does not create a scalable or enduring business. Organic growth must continue alongside it to build something lasting. Joe’s closing line is especially powerful: “If your practice isn’t already built on strong foundations, such as an effective growth funnel, capable people and scalable processes, acquiring a book of business won’t solve the problem. At best, it will postpone it; at worst, it compounds it.” https://lnkd.in/eZyUcn8Q

Many believe acquisitions are only for big players, but here's a myth-busting fact: small businesses can thrive using M&A strategies too! 🤝 Fact: Acquisitions help small businesses grow, diversify, and increase their market share. Whether it's combining forces with similar firms or integrating complementary services, M&A can unlock new income streams and boost your bottom line. 🌟 Feeling intimidated by the idea? Don’t be! With the right approach, entrepreneurs can tap into hidden opportunities for expansion and innovation without the need for deep pockets. Let's reframe how we think about growth! If you want to explore how M&A can work for your business, it’s time to get creative and strategize! 🚀 #BusinessGrowth #Entrepreneurship #MergersAndAcquisitions #SMB #Innovation #BusinessStrategies #MythVsFact https://lnkd.in/gkrqqVgf