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Exit Planners and Your Investment Banker

Exit Planners usually work with you, the client, to create and implement an Exit Plan.

They also help their clients put together a team of advisors.  An investment banker is often times a crucial part of your advisory team, if the goal of your business exit strategy is to sell your business at some point in the future.

I recommend that you engage an investment banker in the early stages of implementing your Exit Plan, rather than when it is time to put the business on the market.  If there is a value gap (meaning that the value of the business is not high enough to meet your needs when sold), the investment banker can help find ways to close the value gap.  Investment bankers work with buyers all the time and offer a fountain of information on how to add value to the company.

Also, if unsolicited buyers come in during the implementation process, you should refer them to your investment banker.   The investment banker can qualify these inquiries to determine whether or not these buyers are worth pursuing – either now or when you are ready to sell.  Sometimes the best opportunity may be an unsolicited offer that is presented prior to the expected time-frame of the sale.  By having an Exit Plan in place, you will be ready to react to such an offer.  In fact, my last exit planning assignment ended with a sale to an unsolicited buyer before the business was even put on the market.

When it is time to put the business on the market, your Exit Planner should stay involved to make sure that you, the client, receive the necessary counseling concerning the sale and that the investment banker is “working for you and not the deal.”

Lastly, when you reach the point in the transaction when offers are being submitted, the Exit Planner can take that real world data and input it into the Exit Plan to help determine whether or not these offers will in fact meet your objectives. Having this information can also help drive the negotiations to a place where your objectives are met.  It doesn’t make much sense closing the transaction unless either your objectives are met or the objectives are modified to work within the parameters of the deal that’s on the table.  With information supplied by the investment banker, both you and your Exit Planner may be able to redefine your goals and objectives from the sale.

It is important for you and your Exit Planner engage an investment banker early in the Exit Planning process. The right investment banker will add a great deal of value to any business sale transaction.

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Julie Keyes
Julie Keyes

Founder & Owner at KeyeStrategies, LLC

Julie is a Certified Exit Planning Adviser and Value Growth Advisor with 30+ years of experience. She works with business owners who seek to understand and maximize their exit and critical transition options.