12 Lessons We Learned About Market Places, Data-Driven Advice, and Strategy From Interviewing Peter Lehrman CEO Of Axial About Selling Private Companies And The Necessary Preparations - E99 Watch Here:
Here is what my team and I learned from this interview: (These are notes from team members, writers, sometimes AI, and even listeners who submitted what i learned loosely edited and shared here) - If it seems a bit crude, you're reading our notes, so. yeah. -Ron
Concept 1: Buy and sell businesses easily.
The process of buying and selling businesses can be a daunting task. With the right resources and guidance, however, it can be made simpler. Axial.com is an internet platform that makes buying, selling, advising, and financing small and medium-sized businesses easier. The company was founded by Peter Lerman, who stumbled into an opportunity to work part-time for a private equity firm while he was in graduate school. He quickly realized how challenging the deal sourcing process was, particularly when it came to smaller businesses. This is because small businesses tend to have very little information available on the internet.
Axial.com helps sellers by providing a platform to list their businesses and connect with potential buyers. It also provides tools to help sellers prepare their businesses for sale, such as financial analysis and market research. Additionally, Axial.com helps sellers find advisors and brokers to assist with the sale process.
Axial.com also helps buyers by providing a comprehensive list of businesses for sale, as well as tools to help with the search and evaluation process. The platform also offers resources to help buyers with financing, such as loan calculators and information about loan programs.
Axial.com helps advisors and brokers by providing a platform to connect with buyers and sellers. It also provides resources to help advisors and brokers with the sale process, such as market research and financial analysis.
Axial.com is a great resource for buyers, sellers, advisors, and brokers looking to buy and sell businesses. With its comprehensive list of businesses for sale, its tools to help with the search and evaluation process, and its resources to help with financing, Axial.com makes the process of buying and selling businesses easier.
Concept 2: Get data-driven advice when selling.
When it comes to selling a business, Axial.com is a great resource for business owners. Axial.com provides data and empirical information that helps business owners narrow the list of potential brokers to interview and represent them in the sale of their business. This data includes information about the productivity, performance, and track records of brokers and M&A advisors. Additionally, Axial.com provides access to a list of potential buyers who may be interested in buying the business. This list includes information about the buyers, the types of transactions they have done, and why they are interested in businesses like the one being sold.
Axial.com also provides a discounted cash flow model spreadsheet that makes it easier to identify certain financial information and plug it into the spreadsheet to build out the model. This spreadsheet is designed to be user-friendly and make the process of understanding discounted cash flow models easier.
Axial.com is a great resource for those looking to buy or sell businesses. With its data-driven advice, tools, and resources, Axial.com makes the process of buying and selling businesses easier and more efficient.
Concept 3: Work with an advisor to sell.
When it comes to selling a business, it is important to work with a competent advisor. An advisor can provide invaluable guidance throughout the process, helping you to get the most out of your sale. Working with an advisor can help to ensure that the process is smooth and successful.
First, an advisor can help you to identify potential buyers and narrow down your list of potential buyers. An advisor can provide you with valuable data and insights into the market and the buyers that are interested in your business. This can help you to make an informed decision about who to work with.
Second, an advisor can help you to prepare your business for sale. This includes things like systemizing your financials, changing accounting practices, and getting some history behind the new accounting. An advisor can also help you to create a confidential profile to upload to Axial.com. This will allow you to get specific recommendations for buyers and potential acquirers.
Finally, an advisor can help you to negotiate the best deal. They can help you to understand the market and the potential buyers, allowing you to get the best possible deal. They can also help you to navigate the legal and financial aspects of the sale, ensuring that you are protected throughout the process.
In conclusion, it is important to work with an advisor when selling a business. An advisor can provide invaluable guidance and advice throughout the process, helping you to get the best possible deal. They can help you to identify potential buyers, prepare your business for sale, and negotiate the best deal. Working with an advisor is essential for a successful sale.
Concept 4: Know buyers' categories.
When it comes to understanding buyers and their categories, it is important to do your research. Knowing the different types of buyers, their preferences, and the kinds of deals they are likely to make is key to getting the best possible outcome. There are strategic buyers, financial buyers, operators, search funds, and holding companies. Each of these buyers has their own preferences and may offer different types of deals.
Axial is a platform that is designed to help sellers narrow the strike zone when it comes to potential buyers. It allows sellers to create a confidential profile with information such as revenue, EBITDA, the industries they serve, and the types of markets they serve. This information helps to narrow the strike zone and make it easier for sellers to find the right buyer for their business. Axial also provides data on the number of transactions different buyers have closed, which can help sellers to understand the types of deals they are likely to make.
Ultimately, understanding buyers and their categories is key to getting the best possible deal when selling a business. Doing your research and understanding the different types of buyers and the types of deals they are likely to make is essential. Working with an advisor can also be beneficial, as they can provide you with invaluable guidance and advice throughout the process.
Concept 5: Trust is the key, not the highest bidder.
It is important to remember that the highest bidder does not always win the deal. In fact, the majority of the time, the business owner is not looking for the highest bidder, but rather the buyer who they trust the most. This could be someone who they have a rapport with, who they feel has the best intentions for their business, or someone who they feel is the safest pair of hands for their business.
In many cases, there may not be a huge difference between the offers, and the highest bidder may not be the best fit for the business. It is important to consider all factors when looking for a buyer, and not just the financial aspect. Trust is a key factor in any business transaction, and it is important to consider the buyer’s reputation, intentions and other factors when making the decision.
Axial is a platform that helps business owners in the process of finding the right buyer for their business. They provide data and advice on who would be the best fit for a particular business, and they also provide guidance on understanding the different types of buyers and the types of deals they are likely to make. This can be invaluable in helping business owners find the right buyer for their business.
Concept 6: Buyers need to articulate interests.
When it comes to selling a business, buyers need to articulate their interests in order to find the best fit. Buyers need to understand the different types of buyers, such as strategic buyers, private equity firms, holding companies, and search funds. Each of these categories has different goals and objectives, and it is important to be able to identify which one best fits the seller’s goals. For example, private equity firms typically have a three to seven-year timeline for investments, whereas holding companies tend to hold businesses forever.
When searching for a buyer, it is important to consider all factors, such as the buyer’s financial capabilities, the buyer’s experience in the industry, and the buyer’s plans for the business. Buyers should also consider the seller’s needs, such as the seller’s timeline for the sale, the seller’s desired outcome, and the seller’s expectations for the business. Working with an advisor can help buyers and sellers identify the best fit for the sale.
Platforms like Axial offer buyers the ability to create a pipeline of acquisition targets that are specific to their interests. Buyers can articulate their interests in advance and credentialize their interests through their profile. This allows buyers to find the best fit for their needs and the needs of the seller.
Finding the right buyer for a business is essential to getting the best possible deal. Buyers need to be able to articulate their interests, understand the different categories of buyers, and consider all factors when looking for a buyer in order to ensure they make the best decision for their business.
Concept 7: Find better matches quickly.
Axial is an online marketplace that helps buyers and sellers find better matches quickly. Sellers create confidential profiles, while buyers create visible profiles that are then made available to sellers and advisors. This structure ensures that buyers are forced to explain the types of businesses they're interested in and credentialize why they're interested in them. This helps to create better matches and more credible matches for the seller.
For example, if a buyer is interested in buying media businesses, content sites, they would create a profile that reflects that interest. This profile would then be matched with business owners who are looking to sell their business on Axial based on the criteria the buyer set up. This eliminates the need for buyers to hunt around and browse to find a business that interests them, as they can only be matched with businesses that fit their criteria.
On a trailing 12-month basis, there have been over 1800 different investment bankers, business brokers, and business owners using Axial to sell businesses. This provides buyers with turnkey access to all of the distribution of sellers using the Axial platform. It also filters out the signal from the noise, so buyers don't have to worry about being overwhelmed with too many options.
The alternatives to using Axial are doing a lot of traveling, networking, outbound cold emailing, outbound cold calling, purchasing lists, and purchasing subscription databases. These are all viable options, but they are time-consuming and costly. Axial makes it easier and faster for buyers to find acquisition targets that are a good fit for them to explore.
Concept 8: Maintain a consistent pipeline.
Maintaining a consistent pipeline of acquisition targets is key for buyers looking to make successful acquisitions. Having a consistent pipeline of potential targets allows buyers to have a steady stream of opportunities to explore and evaluate. It also helps buyers to avoid the “feast or famine” cycle of having too many or too few deals.
Having a consistent pipeline of acquisition targets can be difficult, especially for smaller organizations. The process of finding and evaluating potential targets takes a lot of time and effort. It can be difficult to keep up the momentum of searching for potential targets while also evaluating the ones that are most interesting. Additionally, if a potential target falls through or is not the right fit, buyers must start the process all over again. This can be a frustrating and time-consuming process.
One way to maintain a consistent pipeline of acquisition targets is to outsource the process. This can be done by hiring a team to handle the process of finding and evaluating potential targets. This can help buyers maintain a steady stream of potential targets to explore and evaluate.
Another way to maintain a consistent pipeline of acquisition targets is to use a platform like Axial. Axial is a platform that connects buyers and sellers to help facilitate deals. It helps buyers find potential targets that fit their criteria quickly and efficiently. It also helps buyers connect with potential targets that they may not have known about before.
Overall, maintaining a consistent pipeline of acquisition targets is essential for buyers looking to make successful acquisitions. It can be done by outsourcing the process or using a platform like Axial. Doing so will help buyers find better matches quickly, save them time and money, and ensure they are only matched with businesses that fit their criteria.
Concept 9: Advisors benefit from anonymity.
Axial provides a platform for buyers and advisors to connect anonymously. This anonymity is beneficial for advisors because it allows them to market their clients’ businesses without revealing too much information. For example, if an advisor is trying to sell a business located in rural Oklahoma, they can list it on Axial without having to specify the exact location or other details that could give away the identity of the business. This is important because potential buyers may be able to guess who the business is if too much information is revealed. Additionally, Axial allows buyers to remain anonymous at the top of the funnel, giving them a strategic advantage over competitors like BizBuySell.
This anonymity is also beneficial for buyers. They can remain discreet while searching for acquisition targets, which is important in competitive markets. Additionally, Axial notifies any matching sellers when buyers are active on the platform, allowing them to decide which buyers they want to invite to the process. This helps buyers save time and money by only being matched with businesses that fit their criteria.
Overall, advisors benefit from the anonymity provided by Axial. It allows them to market their clients’ businesses without revealing too much information, while also giving buyers a strategic advantage in competitive markets. This helps both buyers and advisors achieve their goals more quickly and efficiently.
Concept 10: Use Axial to find buyers.
Axial is a platform for advisors to find buyers for their clients’ businesses. It offers a wide range of features to help advisors find the right buyers for their clients’ businesses. Axial provides an extensive list of buyers that is constantly growing. This allows advisors to outsource the process of finding buyers to Axial, saving them time and money. Additionally, Axial provides automated email campaigns to buyers, eliminating the need for advisors to manually create and send out mailers. This allows advisors to focus on other aspects of the acquisition process.
Moreover, Axial provides a range of tools to help advisors manage the paperwork associated with selling a business. It automates the process of sending out NDAs and financial information to buyers, as well as the process of executing online signatures. This makes the process of selling a business much easier and more efficient.
Finally, Axial provides advisors with the ability to sort and sift through potential buyers. This helps advisors narrow down their list of buyers and identify the ones that are most likely to be interested in their clients’ businesses. It also eliminates the need for advisors to manually create and manage large lists of buyers.
Overall, Axial is a great tool for advisors to use when looking for buyers for their clients’ businesses. It provides a wide range of features that make the process of selling a business much easier and more efficient. It also helps advisors to save time and money by outsourcing the process of finding buyers to Axial.
Concept 11: Do your due diligence.
It is important to remember that when it comes to selling a business, due diligence is paramount. It is important for advisors and business owners to do their due diligence when looking for buyers. This means researching potential buyers, evaluating their financial standing, and asking questions to ensure that they are a good fit. It also means understanding the terms of the deal and making sure that all parties involved are on the same page.
Due diligence is an important step in the process of selling a business. It helps to ensure that the sale goes smoothly and that all parties involved are satisfied with the outcome. It also protects the seller from potential risks and liabilities. Therefore, it is essential for advisors and business owners to do their due diligence when it comes to selling a business. This includes researching potential buyers, evaluating their financial standing, and asking questions to ensure that they are a good fit. Additionally, it is important to understand the terms of the deal and make sure that all parties involved are on the same page.
Concept 12: Do the work and research.
When selling a business, it is important to remember that not all buyers are created equal. While there are some fantastic private equity investors out there, there are also some who may not be the best fit for your business. It is important to take the time to research potential buyers and make sure they have the financial standing and experience to make the purchase. Additionally, it is important to ask questions and understand the terms of the deal. It is also wise to seek out advice from experienced advisors and brokers who have a deep understanding of the process.
It is also important to remember that not all information found online is accurate. Many people rely on the opinions of others and the information they find on social media or blogs when making decisions. However, it is important to take the time to do your own research and make sure that the information is reliable. Additionally, it is important to not rush into making decisions and take the time to fully understand the process.
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