Soar to Success June 2015

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Business owners have been known to refer
to due diligence as “the entrepreneur’s
proctology exam.” It’s a crude analogy but a
good representation of what it feels like when a
stranger pokes, prods, and looks inside every
inch of your business.
Most professional acquirerswill have a checklist
of questions they need answered if they’re
considering buying your company. In addition
to these objective questions, they’ll also try
to get a subjective sense of your business. In
particular, they will try to determine just how
integral you are personally to the success of
your business.
Subjectively assessing how dependent the
business is on you requires the buyer to do
some investigative work. It’s more art than
science and often requires a potential buyer to
use a number of tricks of the trade, such as:
Trick #1: Juggling calendars
By asking to make a last-minute change to
your meeting time, an acquirer gets clues as
to how involved you are personally in serving
customers. If you can’t accommodate the
change request, the acquirer may probe to find
out why and try to determine what part of the
business is so dependent on you that you have
to be there.
Trick #2: Checking to see if your business is
vision impaired
An acquirer may ask you to explain your vision
for the business, which is a question you should
be well prepared to answer. However, he or she
may ask the same question of your employees
and key managers. If your staff members offer
inconsistent answers, the acquirer may take it
as a sign that the future of the business is in
your head.
Trick #3: Asking your customers why they do
business with you
A potential acquirer may ask to talk to some
of your customers. He or she will expect
you to select your most passionate and loyal
customers and, therefore, will expect to hear
good things. However, the customers may be
asked a question like ‘Why do you do business
with these guys?’ The acquirer is trying to figure
out where your customers’ loyalties lie. If your
customers answer by describing the benefits
of your product, service or company in general,
that’s good. If they respond by explaining how
much they like you personally, that’s bad.
4 Traps To Avoid
When Selling Your
Company By Patrick Good, Certified Value Builder
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SOAR TO SUCCESS | JUNE 2015 | Business Acceleration Strategies