The Art of Selling Your Business: Winning Strategies & Secret Hacks for Exiting on Top

by John Warrillow

Overview

Freedom.

It's the ability to do whatever you want, whenever you want. It's the ultimate reward of selling your business. But selling a company can be confusing, and one wrong step can easily cost you dearly.

The Art of Selling Your Business: Winning Strategies & Secret Hacks for Exiting on Top is the last in a trilogy of books by author John Warrillow on building value. The first, Built to Sell, encouraged small business owners to begin thinking about their business as more than just a job. The Automatic Customer tagged recurring revenue as the core element in a valuable company and provided a blueprint for transforming almost any business into one with an ongoing annuity stream.

Warrillow completes the set with The Art of Selling Your Business. This essential guide to monetizing a business is based on interviews the author conducted on his podcast, Built to Sell Radio, with hundreds of successfully cashed-out founders.

What's the secret for harvesting the value you've created when it's time to sell? The Art of Selling Your Business answers important questions facing any founder, including—

• What's your business worth?

• When's the best time to sell?

• How do you create a bidding war?

• How can you position your company to maximize its attractiveness?

• Who will pay the most for your business?

• What’s the secret for punching above your weight in a negotiation to sell your company?

The Art of Selling Your Business provides a sleeves-rolled-up action plan for selling your business at a premium by an author with consummate credibility.

Product Details

ISBN-13:	9781733478151
Publisher:	An Inc. Original
Publication date:	01/12/2021
Pages:	256
Sales rank:	1,047,157
Product dimensions:	5.80(w) x 8.50(h) x 1.00(d)

About the Author

John Warrillow is the founder of The Value Builder System™, a simple software for improving the value of a company, offered via a global community of advisors who have earned their Certified Value Builder™ qualification.

His best-selling book Built to Sell: Creating a Business That Can Thrive Without You was recognized by both Fortune and Inc. as one of the best business books of 2011 and has been translated into 12 languages. 

John is the host of Built to Sell Radio, ranked by Forbes as one of the world’s 10 best podcasts for business owners. 

In 2015, John wrote another best-selling book, The Automatic Customer: Creatinga Subscription Business in Any Industry. Prior to founding The Value Builder System, he started and exited four companies, including one acquired by a public company. He lives with his family in Toronto.

You can follow John’s work by signing up at BuiltToSell.com or on LinkedIn and  Twitter @JohnWarrillow.

Table of Contents

Section 1 Things to Consider Before You Start 1

Chapter 1 Value Is in the Eye of the Acquirer: An Introduction to the Art of Selling 3

My Story 5

The Birth of Built to Sell Radio 6

Chapter 2 The Secret to a Happy Exit: The Most Important Question Most Founders Never Answer 11

What's Driving Your Decision to Consider Selling Your Business Now? 13

Push vs. Pull 14

Taking Action 15

Chapter 3 The Danger of Timing Your Exit: How to Decide When to Sell 17

Riding It over the Top 19

Deciding When to Sell 21

Peak Seller vs. Trough Seller 21

Deal Momentum and the Pre-Diligence Process 23

Taking Action 27

Section 2 Building Your Negotiating Leverage 29

Chapter 4 The Slow Reveal: How to Keep Control of the Process 31

The Danger of a Proprietary Deal 33

Asking "What" Questions 35

Taking Action 37

Chapter 5 Fish Where They Are Biting: How to Position Your Company to Be Acquired 39

Positioning: The Foundation on Which All Great Marketing Rests 42

Acquirers Rely on Buckets Too 43

Taking Action 47

Chapter 6 Playing the Field: Understanding the Three Types of Acquirers 49

Acquirer Type 1 Individual Investor 51

Acquirer Type 2 Private Equity Group 53

Acquirer Type 3 Strategic Acquirer 59

Taking Action 64

Chapter 7 Building Your List: How to Identify a Potential Acquirer 67

Choose the Best Type of Auction for You 69

Stock Your List with Strategic Acquirers 72

When Partners Become Acquirers 73

Why Even Bother with Financial Buyers? 74

Taking Action 75

Chapter 8 The 5-20 Rule: How to Zero In on Your Natural Acquirer 79

The 5-20 Rule of Thumb 82

Why No More Than 20 Times the Size? 84

Taking Action 85

Chapter 9 The Tease: How to Attract Acquirers without Looking Desperate 87

Crafting Your Teaser 88

How to Explain Why You're Selling 91

Taking Action 93

Chapter 10 Getting (Almost) Naked: How to Write a Confidential Information Memorandum 95

The Confidential Information Memorandum 98

The Risk of Getting Naked 102

Taking Action 104

Chapter 11 Keeping Your Secret: How (and When) to Tell Your Employees 107

Right vs. Best 108

Your End of the Bargain 110

Two Employee Categories 111

Taking Action 114

Chapter 12 What's Your Number? How to Calculate Your Bottom Line 117

Figuring Out Your Number 118

What's Your Business Worth? 119

What's Your Business Worth to You? 122

Knowing When to Sell-How to Answer the Question 124

Taking Action 125

Section 3 Punching above Your Weight in a Negotiation 127

Chapter 13 Bidding War: How to Get Multiple Offers 129

Ask "Who," Not "How" 132

Business Broker vs. M&A Professional 133

Sell Side vs. Buy Side 135

The Tools for Reaching Out Are Changing 136

Going It Alone 137

Taking Action 140

Chapter 14 You Set the Price, I'll Set the Terms: How to Drive a Great Deal 143

Your Deal Terms 146

Your Left Tackle 147

Letter of Intent 149

LOI vs. IOI 153

Hanging On to Your Leverage 154

Legitimate vs. Bad-Faith Re-trading 155

Taking Action 158

Chapter 15 Earnout vs. Flameout: How to Structure Your Role Post-Sale 161

Your Role as Lender (Vendor Takeback, or VTB) 164

Your Role as Division Executive (Earnout) 166

Your Role as Consultant (Contract/Fee) 168

Your Role as Shareholder (Recapitalization) 169

Taking Action 170

Chapter 16 The Art of the Nudge: How to (Gently) Squeeze an Acquirer for More 173

Getting the Best Deal Possible 176

Clarify Your BATNA 177

Apply the Magic of Adjustments 179

Quantify the Acquirer's Upside 182

Demonstrate How Your Company Will Sell More of Their Stuff 183

Quantify Your Value 183

Kill Them with Kindness 184

Taking Action 189

Chapter 17 The Freedom Paradox: How to Get Comfortable with Your Decision to Sell 191

The Bob Dylan Effect 192

Acknowledgments 197

Appendix A Additional Resources 221

Sign Up at BuiltToSell.com 221

Get Your Value Builder Score at ValueBuilder.com 222

Get Your PREScore™ at PreScore.com 222

Read Built to Sell 223

Read The Automatic Customer 223

Appendix B M&A Lingo Decoder 225

Index 231

About the Author 243