Selling A Business Is Madness … March Madness That Is

By Ed Davis, CPA, CVA, Partner

It’s March … the nation turns its attention to March Madness and the tournament of tournaments (full disclosure, die hard Terps fan and will watch the tournament without them this year; just wait til next year). So it’s in the spirit of the game that we write this month’s newsletter … Game On!

           “The idea is not to block every shot. The idea is to make your opponent believe that you might block every shot.”

                                                                                                                                                         ——Bill Russell

So, here you are. After years of the “do I/don’t I” mental debate you’ve made a major, life changing decision. You’re ready to pursue the sale of your business and move on to your “Phase 2” … more beach, fishing, family, travel, a new career, a new hobby or just TBD time. You called us, we met and you say: “OK coach (that’s us), what’s the game plan for my exit”?

In the spirit of the March Madness, all good game plans are broken down into manageable pieces. Here’s your plan:

The First Half:
1. We’ll spend time with you to understand your goals…this is your tournament. We’ll ID business strengths and weaknesses, assess where you are in your “tournament bracket”, fix problems and prepare for the upcoming challenges. Every team we face will be equally prepared and will present different challenges for us. This is hard work but here’s the risk: this is a single elimination tournament, meaning if you’re not prepared, you lose and go home way too early. You’ve worked way too hard for that to happen.
Time out: this review could take 1 month

2. “Bracket” Assessment – what does the matchup look like? What is the estimate of the market value? How does that compare with what you need “post retirement”? What needs to be done to improve the value? How long will that take?
Time out: this assessment could take 1 month

3. We’ve talked with your other team advisors, the transaction options are understood, the goals are set, its game time.
Time out: allow 2-3 weeks to complete

The Second Half
4. Tournament time: Time to create and implement the game plan and most importantly, know when and how to make the necessary offensive and defensive adjustments. It’s about creating the right market opportunities for your business, marketing to prospective buyers and “scouting” the other teams to make sure the deal can get done on terms and conditions acceptable to you. And doing this repetitively until we work our way through the “brackets”. Like any challenge, we’re likely to have some game fatigue…the patience will be tested and the emotions will run a little higher. The trick is game management…when to go full court, when to accelerate and when to slow down. We have to multi-task but not lose sight of focusing on one game at a time.
Time out: allow 3 months

5. The Final Four: Congratulations, we’ve made it! There are 4 teams remaining and 2 games to play. The adrenaline is working, the fatigue is minimized. In “deal terms”, we’ve received the Letter of Intent (LOI), completed the due diligence (thanks to the great scouting reports) and are ready for a “final purchase agreement”. The pace really picks up—-the finals are within reach.
Time out: allow 2 months

6. The Finals: You did it! You made it! It’s down to you and one other team. And the fact is both teams will be winners because we structured a process to arrive at a deal that makes sense and will work successfully for both teams!! The due diligence is finished, the final purchase agreement has been signed, the financing is in place, inventories were taken and all negotiations completed. You are now ready for the…….

Closing Ceremonies
7. The Win: The final push to stand on the stage and hold the trophy. All the hard work during the past 9 months paid off. You had a plan, accomplished your goals, had a successful settlement, signed the final documents and, finally, you’re all set for your “Phase 2”! Well done!!

We’ve had the benefit of being in this tournament and working with owners of privately owned businesses just like you for 30 years. It’s a team effort and a dynamic process. We’re seasoned veterans and we would like to be on your team. We’ve been through the drills and know what it takes to get “game ready” and “finish” in a way to get you to the closing ceremonies and would like the opportunity to do that for you.

By the way, good luck with your bracket selections this year – see you at the closing ceremonies!

About the author:
Greg Caruso, Esquire, CPA, CVA works with lenders and business owners so they develop exciting goals and then surpass them through the exit and succession planning process, business brokerage, and business valuations. Greg is active in the valuation practice at Harvest Business Advisors and also oversees exit and succession planning activities. He focuses on engineering firms, contractors, wholesalers, manufacturers, and professional service providers.
My website is at:


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