I regularly describe my role as an M&A advisor with two words VALUE CONVEYANCE.
What do business sellers need more than anything else?
They need buyers to recognize the value that they created. It takes a diligent, disciplined approach to the market to first gain buyers’ attention and then to illuminate them about the value of the company.
Value does not convey naturally or automatically.
It definitely does not convey by handing a buyer a stack of financials and tax returns.
It takes an energized engaging communication process that gets the buyer engaged and professionally motivated to learn more about the company.
Buyers have deaf ear syndrome. They are bombarded with so much white noise that they have trained themselves to stop listening quickly. They do not like exaggeration and they do not like unsubstantiated representations.
They highly prefer to work with high quality professionals that look them in the eye and shoot them straight.
They want factual assertions and quality information that they can place reliance on.
The key to the value conveyance model is that you have to be representing a company that has real value. Probably 80% do not. Unfortunately, that does not stop the brokers from hustling those companies in the market.
Fast talking brokers really do not comprehend how offensive their style is to buyers. The buyers are offended that the broker thinks they are dumb enough to be swayed (convinced) based upon the empty rhetoric that they are being provided.
Our firm only accepts clients that we are at least 90% confident that we can achieve our clients quantitative and qualitative goals. We have to be able to take our clients to market with pride, dignity and confidence.
Pride is a massive element in value conveyance. An astute buyer will get an immediate sense for whether the advisor is proud to be representing their client and their company.
This is a very favorable intangible once the buyer recognizes that the advisor is proud to be representing the company. Once you have the buyers respect and full engagement it is a lot easier to expound upon all of the valuable attributes of the company. I like to identify and present at least 20 value components of the company.
Can you list at least 20 value components of your company? If you work collaboratively with a high-quality M&A advisor you will be able to. They will help you see your company from the outside in. The same line of sight that your buyers will have.