What to Expect When You’re Expecting (to sell your brand)



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Media expert Tim Hermes shares his insights into what to do right when selling your brand.

The American Dream. Launching, growing and selling a business. All those years of work paying off. The courtship, the dinners. The (sometimes fake) laughter. The new people who impress. The ones who don’t. New systems, new twists, new visions. A big check. The renovated bathroom your spouse wants (yeah this happened – good call, honey.)

In the last four and a half years I’ve been lucky enough to launch and sell three b2b niche brands. Here’s just a bit of what I’ve learned from both the pre-sale and post-sale sides.

Pre-Sale:

  1. Find a “deal person.” I was lucky enough to meet a supremely capable “sherpa” who also happened to be an investment banker and attorney who navigated me through my first acquisition and had me prepped well for discussion. His retainer fee and commission was worth it.
  1. Lawyer-up. Make sure you have a good contract attorney who knows the loopholes and the “gotchas.” One thing to be on the lookout for is uncollected cash. If it was booked while you own it, you get it. My lawyer saved me more than his fee by catching this in one of my deals.
  1. Be prepared to work. Selling your company is a second full-time job. Anticipate long weeks buried in spreadsheets and forecasts. Your suitor is going to want to see all this, and for good reason. It even makes sense to hire an organizer to get your expenses in order, file them, folders and labels, etc. My first “Sherpa” simply called it “The Box.”
  1. Clean up your collections. Get as close to $0.00 bad debt as you can.
  1. Be prepared to have second thoughts. Up-and-down emotions are common and can happen by the hour. Stick with your plan and your decision.
  1. Respond quickly to any request from your suitor.
  1. But not too quickly.
  1. Try to sell in the Q4 and push your reps to book a lot of forward-contracted business. That puts you on good footing for negotiations by having revenue already on the books, post buyout.
  1. Don’t be irrational as far as your valuation. Be honest with yourself. That doesn’t mean you can’t “ask high.” But have a number in mind that you’d be willing to accept.
  1. Once you get the contract, take the day off. Get away, not to reconsider but to celebrate. This is just for you. The party comes later. Reflect on your success. Then get a good nights’ sleep, and in the morning sign the deal. Keep electronic AND original copies with copies to your attorney.

Ok, you got your deal done. Congrats! Renovate the kitchen!

Post-Sale:

  1. Be prepared to accept. Most acquiring companies will offer a transition plan to help the acquisition move more smoothly. It’s a nice check. During that time you’ll be conflicted at times–“They’re hurting my brand! I should never have sold!” Well, newsflash. It’s not your brand anymore. Your brand is now in your bank account. Step up and be the best team player you can be.
  1. Be prepared to be a cheerleader. Always upbeat, a champion for the employees that came across in the sale, and a thankful partner for your new co-workers. Send weekly reports on time. Communicate positively. Show the love.
  1. Do what you’re asked to do. And do it well. And if you’re not asked to do anything? Volunteer to do a task. If it’s obvious they want you to be seen and not heard? Step back.
  1. Wait three months before recommending any process, personnel, editorial, marketing or other changes that you notice could be improved. Let the new team take charge after the honeymoon period ends.
  1. Embrace the changes. Your new company may have more assets, deeper pockets and high-quality personnel. Chances are, the changes they want to make are good ones. Use that chance to learn, and not fight, the process.
  1. Expect rough patches in Year One.  No company has a perfect employee roster, procedures, policies or systems. Often the challenges will be process-based where a corporate policy has to be followed. Remember, you were an entrepreneurial business. This may be a company that has to have process to control the chaos. Accept it. Usually the challenges are in production, CRM, and order entry. It takes time.
  1. Don’t be the gossip, be the peacemaker. If your team came across in the deal, they won’t always be happy with their new “station.” It’s ok to listen, but you need to point them to their new leaders for resolution. That accelerates the integration and fosters more trust in all directions. Facilitate meetings. Be a good ambassador. But don’t take sides. Step out of the discussion and let the new procedures kick in.
  1. Work hard. It’s possible to keep a low profile but still work to make the business succeed. That usually involves being more forward-facing to the market. More phone calls. Reassuring customers. Smoothing rough edges. Traveling to clients.  It works. It also opens up new opportunities for you within the company.

There ya go – a summary of some tips to consider when you bring your brand to market. I hope this helps. Be prepared for an exciting ride. It’s frantic, stressful, tense, but exhilarating and euphoric too. Hey you’ve climbed the mountain.

Trust me, the view is killer.

 

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More about Tim:  Tim Hermes is the Principal at Hermes Media. A veteran niche publisher, he has launched, grown, and monetized several niche properties as well had a thriving corporate career in publishing. He is also an expert in video monetization and consults with several b2b publishers. Oh, and he has a really great launch idea if anyone is interested.

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