Mergers & Acquisitions

M&A Talk Podcast

M&A Talk is the #1 podcast on mergers & acquisitions. At M&A Talk we bring you exclusive interviews with experts in business sales, valuations, mergers and acquisitions, and more. We talk to the most experienced professionals in the industry to uncover their secrets.

Home Podcast The Art & Science of Selling a Mid-Sized Business

The Art & Science of Selling a Mid-Sized Business

The Art & Science of Selling a Mid-Sized Business

Jonathan Brabrand

M&A Advisor | Author "The $100 Million Exit"

Jonathan Brabrand is author of The $100 Million Exit: Your Roadmap to the Ultimate Payday. He is also a Managing Director of Transact Capital Partners, a boutique M&A advisory firm headquartered in Richmond, Virginia. He has spent over 20 years helping business owners within a wide variety of industries sell their companies to their ideal buyer and achieve the exit outcome they dreamed of. His book, The $100 Million Exit: Your Roadmap to the Ultimate Payday, analyzes large mergers and acquisitions successes and failures to draw practical, actionable advice that company owners can implement to increase the value of their business and be better prepared for an exit.

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Guest Profile

Jonathan Brabrand is an author, entrepreneur, and expert in the field of advising business owners on the sale of their companies. Jonathan is a Managing Director of Transact Capital Partners, a boutique M&A advisory firm headquartered in Richmond, VA. He has spent over 20 years helping business owners within a wide variety of industries sell their companies to their ideal buyer and achieve the exit outcome they dreamed of. His book, The $100 Million Exit: Your Roadmap to the Ultimate Payday, analyzes large mergers and acquisitions successes and failures to draw practical, actionable advice that company owners can implement to increase the value of their business and be better prepared for an exit.

Topics Covered

  • Why does a business owner start the M&A process? [2:45]
  • What percentage of business owners are fully prepared to sell at any time? [4:15]
  • What are the critical components of sale-readiness? [4:55]
  • How do you approach a competitor and build a relationship with them? [10:50]
  • What does a succession plan look like? [12:55]
  • Is succession planning different depending on who the buyer may be (strategic, financial, corporate, etc.)? [14:25]
  • What is the biggest obstacle for business owners to letting go? [16:45]
  • Is the “vacation test” a good way to test if your business isn’t dependent on you? [19:10]
  • What are some of the best ways to incentivize your employees so you can better let go? [20:15]
  • What does a strategic plan look like? [22:00]
  • How are valuations done for middle-market companies? [24:00]
  • When is the right time to sell? Is it possible to time an exit? [25:00]
  • How often are the M&A markets hot? [30:25]
  • When should a seller start preparing their business for sale? [31:10]
  • Does the process of preparing your business for sale differ depending on who the buyer may be? [32:15]
  • Why would a business owner sell if they have a succession plan in place and the business runs smoothly without them? [32:35]
  • Can you still sell your company if you don’t have a succession plan and haven’t prepared your company for sale? [35:10]
  • What’s the essence of valuing a middle-market company? [39:10]
  • How much is value maximization due to running the ideal M&A process vs. preparation? [40:45]
  • Why are M&A advisors and investment bankers in a unique position to maximize value? [41:40]
  • What is the typical difference between the baseline value and the ultimate selling price? [42:55]
  • What are the most common valuation methods? [43:45]
  • How common are revenue multiples? [44:25]
  • What are common multiples in the middle market? [44:40]
  • Can my CPA value my business? [45:40]
  • How do you eliminate avoidable surprises? [47:20]
  • How do reps and warranties relate to surprises? [49:25]
  • Is it possible to hide defects in the business? [51:10]
  • What is a knowledge qualifier and how is it related to risk? [52:15]
  • How do you avoid avoidable surprises? [52:45]
  • Should you disclose in the offering memorandum that one of your employees is a convicted cocaine dealer? [53:25]
  • Is price the only aspect that matters? [54:35]
  • Should a deal structure be simple or complex? [56:30]
  • Example of complicated deal structures [58:20]
  • Most common M&A deal structures [1:00:25]
  • Why do buyers propose complicated deal structures? [1:01:00]
  • Why is poor positioning a common mistake for sellers? [1:02:15]
  • How can an M&A advisor help with positioning? [1:04:50]

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Resources Mentioned

Acquired

Acquired

The Art of Selling a Business With $10 Million to $100 Million in Revenue

Written by Jacob Orosz, President of Morgan & Westfield

For a business to sell for what it’s really worth – or even more – you need to properly prepare. But too many entrepreneurs put off planning the sale of their business until the last moment. Acquired – The Art of Selling a Business With $10 Million to $100 Million in Revenue will help you prepare your business for sale and walk you through the sales process, dodging the pitfalls along the way. With a significant amount of your wealth tied up in your business, planning your exit is one of the most critical initiatives you’ll undertake.

Read more