Every buyer does things a little differently, so we wanted to go over how things work if you’re considering selling to us. These steps can be a little fluid at times, but this is generally what you can expect:
1. Initial contact and NDA
Whether we find you or you reach out to us, this is a simple get to know you. It can be via Skype, phone, sometimes even just email. This is where we learn basic details about your business: what you do, how long you’ve been in business, why you might want to sell, etc. This (and any other step) is also where you can ask us as many questions as you like.
Our NDA is right here. We don’t like wasting your time or ours, so if we get enough information in this step we can give you a rough ballpark estimate of what we’d pay for your business.
2. Company Details, Questions, General Investigation and Q&A
If we’re both on the same page we can go into a deeper dive of the business.
We’ll ask a lot of questions here: finances, number of users, how frequently they use the product, conversion rates, all that kind of stuff. Don’t worry if you don’t have this info readily available yet, we talk to plenty of people and everyone’s level of organization varies significantly.
3. Offer via LOI (Letter of Intent)
If we’re interested in making an acquisition, we’ll send you a Letter of Intent. An LOI is a relatively straightforward (usually just a page or two), non-binding document that lists the high level details of the offer. It’ll show things like price, what assets are being acquired, the transition period (if any), etc.
4. Due Diligence
Due diligence is when the buyer goes through all the details (and more) of what was discussed during step #3. This is where we’ll ask for documentation for everything. This is the most tedious and boring part of the acquisition process. We (and everyone who’s ever done any acquisition) wish there was a way around this, but unfortunately it’s a necessary evil!
Closing is the process of signing the paperwork, escrowing the cash, transferring the assets, and releasing the funds. Depending on the deal this can take an afternoon or a week. It depends a lot on the complexity of the assets that are being transferred.