Arranging a Call with the Seller
Many times, we get requests from prospects to speak with the seller directly.
There are three kinds of prospects we deal with, in general, who ask for this request; and there are two lenses which we work from.
Obviously if we are representing the seller or the buyer, the approach will be slightly different, but we are not in the business of trying to eat up time just for the sake of eating up time.
As a seller, you want to make sure you focus a lot of energy and effort on serious folks and the Tire-kickers you don’t blow them off, but you try to stroke them to become warm prospects when they are actually ready and in a buying behavior or mood.
- Tire-kickers Asking Questions, Not Serious – Most of the times these folks don’t even know what they don’t know. They think they are interested, but are really just tip-toeing and seeing what’s out there. They act like they are interested, but really they don’t know what they want or how much they want to spend. When everything lines up, they still find excuses to not even place an offer. We want to make sure anybody just kicking the tires and not interested in an offer with proof of funds, stays away from sellers. Yes, a Tire-kicker can turn into a legitimate prospect, but there are ways to climb that process without getting on a phone with a seller.
- Expressing Interest, Not in Ballpark – Folks like these are tough to ascertain. Are they serious? Do they have the money? Can they put a deal together? They are asking some decent questions, but you are unsure of their intentions. It is important to find out their capabilities without offending and gathering intel about the prospect, without rocking the boat to cause any hint that you don’t treat a buyer with the good graces to do a deal. You must trust they can get through the finish line, but you don’t want to overhype them either.
- Expressing Interest, Serious, Want Comfort and Assurance – These are generally newbies to the acquisition world, but they are really interested in this business. They looked at lots of businesses and sifted through information endlessly. But they are on the fence about doing a deal and are filled with anxiety and nervousness. A call will generally calm this person down if the seller adequately communicates what the buyer is seeking and can articulate such.
- Seasoned Vets – These aren’t always easy to tell because there are so many pretenders who act like they’re a big Investment firm. Many times a firm in Private Equity that walks their walk, has a process they try to stick to. A certain EBITDA or revenue amount, a recurring customer threshold, or business fundamentals they are seeking. They want questions answered upfront. They will submit a IOI or LOI early on, but many times will want communication with the seller just to make sure it’s a good fit. They will do heavy due diligence. You want to give these people the time of day as best you can. You want to provide info that seems like it’s due diligence info because they are serious, legitimate, can afford your business, and are in the buying mood in your industry. These people won’t waste much time and you want to strike when the iron is hot because they may move to another business on their radar, with an owner who is giving them the time of day.
Interest should be there before taking up a seller’s time, and an individual, even a higher up at a PE firm should read the prospectus or Confidential Information Memorandum before requesting to hop on with a seller or ask a lot of questions. Many times we get questions that are clear as day answered in materials we sent out. It’s important to be respectful of the process as a buyer, and if you are a seller, it is better to engage with any prospect than not engage as a rule of thumb. But we as brokers do a pretty good job at sifting out the contenders from the pretenders. This is based on their background, the questions they ask, and the process they are taking.
Obviously this depends on whether there is a lot of information to sift through beforehand, or whether the seller has limited information and prefers to talk on the phone to answer any questions.
Contact us for help with your next acquisition:
Phone – (800) 773-1523
Email – email@example.com
Leader in Acquisitions with Expertise in Representing Sellers & Buyers on Deals
Jarbly is a leader in acquisitions with expertise in helping with listings, negotiations, LOI's, asset purchases, company purchases, and real estate purchases. JARBLY has access to high net worth individuals if you are on the sell-side and businesses that may be of interest to you if you are on the buy-side.
- Phone: (800) 773-1523
- Email: firstname.lastname@example.org