8 Things You Need To Do Before Selling Your Startup

Your company is growing. You have attracted a lot of attention within your industry. You have realized your goals. You are nearly at the finish line. In your mind, it is time to consider selling your business. The interest is there and the timing is right. Before you take those next steps, there are certain things you need to do.

1. Prepare for scrutiny

Any company seeking to acquire your startup will do their due diligence and will dig in deep into your financials. You want to make sure that your books are complete and up-to-date. Conducting an official audit or review will give your buyer confidence about the state of affairs.

2. Air your dirty laundry

While the urge to keep secrets may exist, you should avoid this temptation. If there are skeletons in your closet, you should reveal them sooner rather than later. You wouldn’t want those surprises disclosed during a due diligence process as it will reflect poorly on you, and will be much harder to address constructively.

3. Do a SWOT analysis

Defining strengths, weaknesses, opportunities and threats will prepare you for discussions with prospective buyers. If you have done a thorough SWOT analysis, you will be able to respond thoughtfully when potential buyers try to poke holes in your business strategy.

4. Pay yourself

5. Trim the fat

Determine where you are realizing ROI and which projects and activities are dogs. You want to be able to demonstrate higher margins and greater profit and this often means paring down your list of products and services.

6. Put your best foot forward

You want to represent lucrative numbers and an impressive growth trajectory. Make sure you are able to represent your success in a succinct, compelling and accurate manner. Buyers are going to want to see, at a high level, information related to risks, growth and profit.

7. Make sure your business is transferrable

If the value of your business, and the intellectual property, rests squarely on your shoulders, that could potentially be a problem for a prospective buyer. You want to make sure that your business is transferrable – the people, the product and the processes. Demonstrate how the pattern of success is repeatable and sustainable, even without you at the helm.

8. Prepare early

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