Additional Ways to Market Your Company for Sale

Jacob Orosz Portrait
by Jacob Orosz (President of Morgan & Westfield)

Executive Summary

The steps that follow are necessary to consider only if the initial marketing campaigns to sell your business aren’t generating adequate results.

So, if they’re not coming to you, you may need to go to them.

There are four categories of buyers you can try to reach: individuals; financial buyers; strategic buyers, and people already involved in your business, such as managers, employees, or family members.

You can also focus on selective, targeted advertising on Google, Facebook, YouTube, and other platforms.

Some of the tried-and-true approaches outlined below have risks. Chief among them is the risk of losing confidentiality. Many people assume that when a company is for sale, it’s on shaky financial ground. Creditors may restrict their lending to you, or vendors may shy away from long-term contracts. You don’t want to lose valuable clients, vendors, or employees because of negative assumptions that people make when they learn that your business is for sale.

But for those of you who want to branch out further with your marketing strategy, we have some additional suggestions you may want to explore, starting with an obvious but often overlooked one…

Consider People You Know

Sometimes, you don’t have to go very far to find the perfect buyer. Does anyone you know seem to be a possible candidate? Has anyone expressed interest in purchasing your company in the past?

For Small Businesses: There are people in your life who dream of owning a business like yours. You’ll never know who they are until you start trying to connect with them. Once you begin talking to the people you know for ideas, potential interests, and references, you may find that you have a world of opportunities at your feet.

Word-of-mouth: You can do a lot of marketing via your personal network. People love to share compelling stories. If your business is well known, then word of mouth may be enough to spread the news when you list your business for sale. Cast a wide net. Spread the word about your intent to sell among your friends, acquaintances, and business contacts. Inquire with people you know, but remember: if you do so, you must be prepared for the public to learn of your plans quickly.

Print, direct mail marketing, and advertising: There are a number of areas where you can look to place a classified ad, such as trade publications or periodicals geared specifically to your industry. You may also want to consider a direct mail campaign targeted to a list of business owners or geared to a geographic area. However, please see our article on “Hunting vs. Fishing” before deciding to do so. In these cases, a well-written, personalized letter will likely get the best results.

Selling to an Employee or Management Team

Often, employees or your management team may have aspirations to become business owners. Your own team may be a source of potential leads to buyers, or it may be the cause of conflicts and hold-ups if not handled properly.

What are the benefits of selling to an employee?

Employees are familiar with your business operations, strengths, customers, competition, and unique advantages in the market. Your current managers or people in their networks may have distinct insider knowledge that allows them to quickly make a decision, which can be one of the most efficient sales experiences that any seller can hope for.

Are there any drawbacks with selling to an employee?

An employee may not have the financial resources necessary to buy your business and invest in the future growth of the business. It can be an adjustment to go from being an employee to being an owner, even for the most aspiring entrepreneur.

To sell to an employee, be prepared to finance all or part of the sale or arrange for a bank to finance the transaction.

Disclosing to your team members that your business is for sale may cause some disruptions. Employees may fear the upcoming change and leave their positions or may even attempt to undermine the sale.

If you begin serious discussions with the wrong person, the dynamic shifts from an employer-employee relationship to a business-owner’s relationship to a business owner. This can cause tension in the work environment throughout negotiations and ownership transfer, especially if discretion is not maintained and confidentiality is not respected.

Employee Stock Ownership Plans (ESOPs)

Employee stock ownership plans are one way to integrate employee ownership in a company, often positively affecting the employees’ commitment, dedication, and productivity. In some cases, selling to one or more employees may also have tax advantages.

Employee stock ownership plans are plans in which employees can buy shares of a company under specific terms.

Not often seen in businesses with less than $5 million annual revenue, ESOPs are complex and expensive to establish. They often require the specialized knowledge of accountants, tax advisers, and lawyers for ongoing re-examination and re-certification to keep the plan compliant with all regulations.

Although the process varies, typically, the ESOP plan purchases stock at its inception, using a bank loan. Employees can receive shares as compensation, like a 401(K), with the potential for the ESOP shares to vest immediately or over time, as with a pension plan. As employees reach retirement age, they will have options to diversify their ESOP holdings away from company stock or cash out.

An ESOP structure may make sense for your business, but these normally yield the lowest sales price and are often used only as a last resort.

Selling to a Competitor

There are advantages and disadvantages to selling your company to a competitor, so it’s important to proceed carefully. A competitor will already be familiar with your industry and marketplace and will likely be motivated to purchase your business as a means of expanding their own market share.

However, it can be risky to let your competition know that you want to sell your business. This is an area where we can help protect your confidentiality if you want to pursue a buyer who is a competitor.

Which companies acquire other companies?

Generally, when a company buys another company with which they are not a direct competitor, it is for one of two reasons:

  • The business is in the same industry, expanding into your area. This could be a local company or one from a distance.
  • The business is in a related industry, interested in expanding their products or services to an existing client base to include the products and services your company offers. Rather than build a business from scratch, they may be interested in simply acquiring yours. If you choose to approach a company you think may have this kind of “synergistic” potential, be prepared to clearly and concisely demonstrate the potential to the buyer’s satisfaction.

Professional Contacts

There are many other contacts you can reach out to in order to broaden your marketing strategy.

These professionals are in contact with potential buyers every day. Keep in mind that if you establish a relationship with any of these professionals and it results in a successful sale, it is best to compensate them for their facilitation.

  • Accounting and Legal Professionals: Close advisers, such as lawyers and accountants, get to know the business owners they work with and may be able to connect you with their clients or someone in their network. Most firms have specialized groups in focused industries; you want the information for the group that specializes in your industry.
  • Consulting Professionals: These people are in close contact with senior executives and can be in a terrific position to connect you with buyers. When you are contacting a professional at a consulting firm, attempt to reach the most senior-level contact possible. Research their portfolio and industry specialties, and approach them with a professional introduction that clearly indicates why you’re contacting them.
  • Industry Associations: In your local community, in your state, and nationally, there are likely multiple associations for professionals in your industry. These organizations connect people in the same and overlapping businesses and bring them together through online forums, trade shows and events, and industry-specific publications. Learn the names of the major associations, and gain membership if necessary. Reaching out to other members, advertising within the organization itself, or participating in an event could introduce you to a range of potential buyers.
  • Active and Retired Senior Executives: Current or retired executives in your industry often have extensive networks and may be less conflicted about recommending potential buyers. Using your knowledge of your industry, both local and widespread, consider executives who may be able to refer you to others in their network or who may be potential buyers themselves.

Other Potential Buyers

There are a few other areas to consider where you may find potential buyers.

Employees of Competitors

A competitor’s employees or management team may be interested in buying your company. Of course, it can be hard to find the right employees to approach. There is no magic approach to finding competitors’ employees. It is generally done by word of mouth, through local classified advertising, or trade press advertising. In some cases, more aggressive buyers will contact business owners either directly or through a broker.


Often, your best customers are those who are your biggest fans. They promote your business within their circle because they love what you offer. They may make large purchases on a regular basis; they may have approached you about business deals, offers, or opportunities in the past. Don’t overlook this important group of potential buyers.


It’s common for businesses to acquire other businesses that they are already connected with. Rather than continuing to outsource the product or service to you, it can be more profitable and part of an acquisition strategy to bring your services under their corporate umbrella. Sometimes referred to as “vertical integration,” this type of acquisition can complete the value chain for a company expanding into new industries or areas.


Treat an “investor” like any other buyer. If a buyer claims they have an investor, it’s reasonable to request that the investor sign a non-disclosure agreement and also submit documentation that proves they are qualified. After all, how do you know the investor is qualified? If you don’t qualify the investor, then any buyer can hide behind the cloak of an investor to avoid qualifying themselves.

Private Equity Groups (PEGs)

Private equity groups raise pools of capital from limited partners, such as pension funds and insurance companies. These investments are then structured into a fund with a typical life span of 10 years. The PEG then invests this money on behalf of their investees or limited partners in an attempt to maximize their return. The PEG invests by purchasing privately held companies with the goal of exiting these investments in a three- to five-year time frame. Private equity is technically “equity that is private.” Public equity is “equity that is publicly held or traded.” Because it is private, the returns on private equity are difficult to assess accurately. Private equity groups are the largest and most common buyers of mid-sized companies. They generally require a minimum annual cash flow (SDE or EBITDA) of $1 million per year.