The Agenda

The initial meetings and phone calls with buyers are relatively low-key. 

Let the buyer ask as many questions as they want and answer them as clearly and forthrightly as possible. Explain your business and its operations as thoroughly as you can. Be enthusiastic. Show pride in your company. Weave in interesting tidbits about its history. You can also mention your ideas about growth potential, as well as what you like and dislike about your business.

Those are the “do’s.” Here are the “don’ts” regarding your initial calls and meetings with buyers:

• Don’t discuss financial aspects of the transaction, such as the purchase price or deal structure, during the meeting – leave this to your M&A advisor to negotiate.
• Don’t disclose proprietary or trade secrets.
• Don’t show your tax returns, bank statements, or other documents that are customarily only shown during the due diligence process – which occurs after a letter of intent (LOI) is accepted.

Be consistent with the details you present to buyers because any inconsistencies will be noticed.

The Importance of Honesty

Be honest. You’ll establish credibility by being up front about your business’s downfalls. For instance, point out aspects of your business the buyer might consider changing, such as implementing new advertising strategies or pursuing new markets.

The Importance of Consistency

Memorize the information in your CIM. Be consistent with the details you present to buyers because any inconsistencies will be noticed. If a buyer doubts what you say because your claims are inconsistent, you’ll lose the sale. For example, if you say your markup is 35% in your CIM but later claim it’s 40% when you meet with the buyer, the buyer will feel they need to validate all your claims and will take little of what you say at face value thereafter.