Creating a High Quality Listing
In real estate and M&A, a high quality listing is very important to draw in leads.
When drafting a listing, you want to make sure you articulate the key highlights to draw in folks interested in the deal.
The two things to do are to cast as wide a net as possible while drawing interest from quality folks who are actually willing, able, and ready to buy.
A listing is a general advertisement that solicits the offer.
A quality listing in the M&A world comes down to highlighting the key important numbers in a transaction that someone will want to know such as Revenue, Profit, EBITDA, Seller Discretionary Earnings or Income; but also commentary on to why to take advantage of this business opportunity.
You want to highlight the strengths, missing things of value that cannot be seen from numbers alone, market competition, moats or barriers to entry, reasons why the owner is selling.
You want to give as much teaser info away without giving away the secret sauce or anything that you want someone to know after they receive appropriate documents like an NDA or non-disclosure.
Quality advertising is dual fold.
You want to draw people in immediately.
You also want to draw people in over time who may not be ready to buy now but will be, in the future.
The best example I can give you is let’s say that you see a billboard promoting a DJ. You might say to yourself that person would be great for my child’s birthday party or wedding. But let’s say that the party is not for 6 months from now. By the time 6 months rolls around.
However, if you stayed in front of that person up until the party your chances of getting contacted by that person goes up exponentially.
Good advertising is much about a quality ad that entices them on the spot, as it is about staying in front of someone to get them to contact you when they are ready.
Advertising is about honing in on why you are the best, so that when they do choose that product, they choose you.
Once you establish a proper listing in the right places that buyers actually look, you want to make sure that your systems once they reach out are dialed in. This includes sending an NDA right away in an easy format such as e-sign, and then following up with them to make sure they sign the NDA. Then, it requires sending the proper materials that they will look out for such as a CIM or prospectus or deck. Then, you want to follow up with any questions that they have. Naturally, you want to field as many questions as possible without wasting too much time so you can spend time with the serious folks that actually have the funds to proceed with a transaction.
Finally, you want to structure a deal in a way that is feasible. It’s really about understanding the mindset and the background of the potential buyer so you can really hone in on what it will take to get a deal done.
Our sellers generally guide us with what price they want, but how to actually commence on a deal is sometimes quick once we establish a good buyer, and other times it takes fenagling and modifying to get a buyer to come to an offer that makes sense, that a seller will agree to.
We don’t want to waste a seller’s time and therefore, we try to do as much of the questioning upfront as possible before we ever get to management call. A quality listing will prevent a lot of tire kickers though while keeping the net pretty wide.
If you need help with selling your business, you want to select a firm that takes this all into account.