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Key Roles and Professionals Involved in the Sale of a Business

Selling a business is a complex process that involves a variety of key players and stakeholders. From investment bankers and attorneys to tax advisors and wealth managers, each expert adds their own unique value and assists in maximizing the outcome of the sale.

These professionals will understand the nuances of selling a business and will become essential assets in streamlining the overall sale process.

Selling a business often takes months. So, waiting until the last minute to prepare a sale readiness team just isn’t a viable option. As such, business owners should draft their team well in advance to mitigate any potential risks or roadblocks. 

Moreover, since these sale readiness professionals will work closely with ownership, having open lines of communication and mutual trust is essential. Understanding each role’s expectations and concerns is the key to a smooth exit. 

Let’s explore each key player in the sale process to help business owners like you understand the value each expert brings to the table.

At G-Squared Partners, our Sale Readiness team has supported dozens of M&A transactions, some exceeding hundreds of millions of dollars in value. Our experienced professionals assist with various financial matters, from cleaning up a business’s books to leading the due diligence process on behalf of the seller. 

Investment Banker (or Business Broker)

Investment bankers and business brokers are essential in preparing a business for a sale. Think of them as the team's quarterback, guiding and directing the sale process as it unfolds.

They play a wide variety of roles in the sale process, including advising business owners on the potential valuation they can expect to receive for their business. To arrive at this valuation, they’ll take into account several key factors:

  • Market trends
  • Business health
  • Potential growth

The goal of collecting, analyzing, and presenting this information is to portray the business in the best possible light. But, much more than simple analysis and presentation, these professionals will leverage everything from their own industry connections to marketing acumen and tools to attract potential buyers.

They’ll also play a role in the negotiation process and help finalize sale terms that benefit the seller while handling possible roadblocks, disagreements, and other issues.

To vet a potential investment banker or business broker, consider these key elements:

  • Past success and experience in similar business domains.
  • The resources they bring to the table, including connections and platforms.
  • Transparency in their fee structure and any other associated costs.

An important distinction: entrepreneurs with smaller businesses should work with a business broker instead of an investment banker.

Sale Readiness Advisor

Sale readiness advisors act as pivotal financial strategists during the sale. They ensure that a business's finances are in order and represented clearly and accurately.

This often includes the services of an outsourced CFO, who will evaluate a company’s financial health while identifying strengths to highlight and weaknesses to address before potential buyers scrutinize every aspect of a business during the due diligence phase. 

When reviewing financial statements, sale readiness advisors will often work to restate financial records, include EBITDA add-backs, and ensure everything is accurate and compliant with industry standards like GAAP.

These optimized financial statements will be essential in building trust between the buyer and seller.

Outsourced CFOs and other sale readiness professionals will also offer actionable insights to ownership and other stakeholders. They’ll recommend strategies that will increase a business’s value in the marketplace.

Attorney or Legal Counsel

Attorneys and legal counsel are indispensable. They ensure a legally sound sale and minimize the potential for legal risks and compliance issues throughout the transaction.

Their expertise also comes into focus when creating the foundational documents for the sale. Drafting legal documents is a meticulous process and involves several time-intensive steps:

  1. Reviewing
  2. Suggesting amendments
  3. Finalizing contracts to protect both parties

From creating purchase agreements to reviewing non-disclosure agreements, it's essential to have these legal experts on call to streamline the selling process. Work with an attorney that stays up to date with all the relevant laws and regulations pertaining to business transactions to ensure every stage of the sale proceeds without issue.

This proactive approach will help identify possible pitfalls and ensure a business is compliant while protecting the seller’s interests.

Tax Advisor

Next on our list are tax advisors. During the sale process, tax statements and other related documents assist buyers in understanding the potential value and history of a business. These assets are often quite intricate and demand an expert eye.

Tax advisors are vital in helping structure the sale in a tax-efficient manner for the seller, advising on issues including:

  • Sale Structure: whether it’s an all-cash transaction, equity rollovers, or seller financing, advisors will outline possible benefits, implications, and considerations.
  • Asset Sale vs. Stock Sale: is the business sale in assets or stock? There are varied tax consequences for each that can affect the seller’s liability — and an advisor will offer critical insights into each option. 
  • Negotiation: regarding tax implications in negotiations, advisors will recognize potential conflicts and mediate these discussions while offering their own expertise toward finding a balanced solution.

Wealth Managers

Last on our list are wealth managers or, more accurately, a wealth management team. 

These financial professionals ensure the effective allocation and protection of funds after the sale of a business. They’ll play a critical role in helping entrepreneurs manage the proceeds of the sale — which can often run into the millions. 

The combined expertise of these financial advisors will help guide investment decisions. Additionally, key players like estate planners will offer strategies to protect assets for both the current generation and future beneficiaries.

Work with these experts to develop a comprehensive post-sale financial blueprint that safeguards wealth, ensures growth, and minimizes tax liabilities.

Where to Get the Assistance Your Business Needs

The depth of expertise needed to navigate the sale of a business is diverse and intricate. Each professional, whether they’re an outsourced CFO or a wealth manager, will offer integral contributions.

Owners looking to make the most out of the sale of their business should leverage this pool of expertise as the complexities of the process are not something one should navigate alone. 

Simply put; the potential pitfalls, legal issues, and financial nuances require the expert hands of professionals. Building a sale readiness team well ahead of time is critical to ensuring a smooth and painless transaction. Often, these sale readiness advisors will have connections with the other professionals you need, and will be more than happy to make introductions. 

If you’re ready to embark on the journey of selling your business, be sure to connect with the team here at G-Squared Partners. With our deep industry knowledge and a vast network of trusted professionals, we're perfectly positioned to ensure your sale goes off without a hitch.