A Lawyer, a Banker, and a Seller Walk Into a Bar …


About the Episode

In this episode, Michael Frankel joins us to talk about the world of M&A from almost every angle. Michael has experience in M&A as an acquirer, lawyer, investment banker, target, and advisor. Join us for two hours of in-depth conversation with Michael ranging across his many roles in the M&A world, including his insights into corporate development as an acquirer, views as an M&A attorney and investment banker, his experiences as a target and CFO, then finally his comments as an informal advisor, speaker, and author of three books and numerous articles on innovation, M&A, and strategic transactions. 

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In this Episode

Part 1: Michael Frankel on Corporate Development as an Acquirer
5:30 The buy vs. build vs. partner decision
6:45 How important is price for strategic acquirers?
9:20 What role does M&A play in strategy? And what are the alternatives to M&A?
10:30 What goes into the buy vs. build decision?
11:55 What are the different types of partner relationships as an alternative to M&A?
13:40 Why would you partner with someone when you can buy them?
15:35 How often does the seller have intimate knowledge of the buyer’s corporate strategy?
17:10 Why is knowledge of the buyer’s strategy important, and how can it be used in negotiations?
19:05 How common is it for buyers to have different reasons for acquiring a company?
21:20 Why do buyers not share their corporate strategies with the seller?
Part 2: Michael Frankel as an M&A Attorney
28:45 What is your advice to M&A lawyers?
29:00 What is edge-case risk?
30:45 What is your advice to clients of M&A attorneys?
32:30 How do you find the right M&A lawyer?
33:00 How much experience should your M&A attorney have?
35:20 What are typical hourly rates for M&A attorneys?
37:15 How do you find a good M&A attorney?
39:20 Can I just use Google to find an M&A lawyer?
43:20 When should you engage your attorney?
44:30 Do you recommend a fixed fee or hourly fee when hiring an attorney?
45:45 Should your attorney help you conduct pre-sale due diligence?
46:55 Can your general commercial attorney help you conduct pre-sale due diligence?
Part 3: Michael Frankel as an Investment Banker
50:30 What is the unique perspective of an investment banker vs. an attorney and the other parties in the transaction?
53:30 How do you find an investment banker that’s a good fit for your situation and company?
56:10 What role does an investment banker play in helping you prepare your company for sale?
57:30 What roles do the investment banker and attorney play in the negotiations?
1:05:10 What role does the investment banker play in the due diligence process?
Part 4: Michael Frankel as the Target
1:12:45 What is the major difference between being an acquirer and being the target?
1:15:15 How much help do I need if I already have an LOI on the table?
1:17:35 How commonly do sellers underestimate the difficulty and complexity of closing a transaction?
1:20:00 Why are targets at a disadvantage, and what can they do to stack the odds in their favor?
1:22:00 What are the implications of skipping the process of preparing your company for sale?
1:25:40 Why do some owners neglect preparing for the sale?
1:27:00 What type of prep work should be done years in advance?
1:28:30 Should the owner know everything that needs to be fixed before they put their business on the market?
1:31:00 Why do some owners fail to groom a successor?
Part 5: Michael Frankel as CFO
1:43:40 What is your advice as CFO to entrepreneurs considering a sale?
1:46:30 How many problems can be fixed by hiring the right team?
Part 6: Michael Frankel as an Informal Advisor and Author
1:49:55 What is the role of an informal advisor to an entrepreneur?
1:53:00 What should be specified in an agreement with an informal advisor?


  • The role of an M&A lawyer is to make sure the true business intent is reflected in the agreements, and that the client doesn’t experience unintended consequences.
  • A term sheet is 1-2 pages long, a merger agreement is 100 pages long. Why? The term sheet doesn’t cover unintended consequences.
  • Your ability to rely on your skills and knowledge when finding an M&A lawyer are minimal. It’s best to find an M&A lawyer through a referral from someone you respect.
  • There is a lot more risk to the target than to the acquirer.
  • An LOI is worth the value of the paper it’s written on.
  • The level of knowledge and risk aversion are totally different between the target and acquirer. As a seller, you have complete knowledge of your company. The acquirer knows very little about your company and will always assume the worst-case scenario if they cannot obtain a satisfactory answer to any of their concerns.
  • Properly preparing your business for sale can add 20% to 40% to the value of your company.
  • The cost of fixing problems doubles or triples once the problem is in the hands of a buyer. Michael would rather acquire a company with $5 million in EBITDA that has few problems than a company with $12 to $14 million in EBITDA that has an abundance of problems.
  • When assessing the implications of legal risk — a small chance of a catastrophic risk is not worth it.

Learn More About This Episode

Resources Mentioned in This Episode

Meet Our Guest

Michael Frankel

Michael Frankel

Senior VP at Deloitte

Michael Frankel is the senior VP at Deloitte who leads a team that helps the firm build and operate new technology businesses.

Michael Frankel is a member of the Deloitte firm’s Operating Committee and the Managing Director and head of Deloitte’s New-Venture Accelerator (DNA) which is responsible for helping Deloitte strategize, build, and operate technology, analytics and other new business models. Throughout his career, Michael has set himself apart as a driver of growth and innovation, building and expanding new businesses through organic building, ecosystems, and M&A.

Prior to joining Deloitte, Michael led corporate development, strategy, innovation, and corporate venturing at several global technology and information services companies including LexisNexis Group, IRI, GE Capital, CME, and VeriSign. He has also served as CFO/COO at two early-stage technology companies. He has led teams that have executed more than 100 M&A/strategic transactions and 20 corporate venture investments, as well as many complex ecosystem relationships. He began his career as an investment banker at Merrill Lynch and as a deal lawyer at Skadden, Arps. Michael holds a BA, MA, JD, and MBA from the University of Chicago. Michael is a frequent speaker on corporate growth and innovation. He is the author of three books and numerous articles on innovation, M&A, and strategic transactions. Michael has served on public and private corporate boards as well as on the Alumni Board of Governors at the University of Chicago. He lives in New York with his wife and daughter.

Location Location: New York, New York

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