Selling your technology company for strategic value involves
far more than creating a great technology, product, or service. Much of your
success will depend on your business model and important value drivers such as
contractually recurring revenue and network effects. The most important factor
is the process you employ when you sell your company. The greater your
company's reliance on the leverage of technology, the greater the room for the
market to interpret its selling price.
We explore all aspects of the M&A process, from the
planning and marketing to the Letter of Intent, due diligence, and closing, and
everything in between. We discuss topics like the subtle language that buyers
use in LOI's that can cost sellers huge swings in value at closing; optimal
transaction structures, avoiding punishing net working capital adjustments,
negotiating tactics, and much more. This book is a must read for the tech
entrepreneur contemplating the sale of their business.
In order to maximize your company's value you must fully
engage the competitive marketplace. We have see seen swings in the value of
technology companies of millions of dollars between an unsolicited offer for a
small software company by a Private Equity Group and the ultimate purchase
transaction from a strategic industry player. That staggering result is the
difference from selling at a cash flow
multiple and selling for strategic value in a competitive soft auction.
The greater the complexity of the process, the greater the
advantage to the one with experience. Just ask a rookie quarterback in his
first NFL start. Selling a business is a highly complex process and the
business seller is usually in their first transaction while the typical buyer
has made dozens of prior acquisitions. This book attempts to level the playing
field by sharing the author's seventeen years of deal making experience
representing technology focused sellers of businesses.
Dave Kauppi is a Merger and Acquisition Advisor and Managing Director of MidMarket Capital, providing business broker and investment banking services to owners in the sale of information technology companies. To learn more about our services for technology business sellers click to visit our Web Site MidMarket Capital
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