Be M&A ready and achieve the best valuation
October 30, 2020 | Jani Tsui
When should you start preparing your company for sale, even if you don’t have any prospects or buyers knocking on your door? The short answer is: now.
Shannon Byrne Susko, our 2020 TechExit.io West emcee chair and session speaker, knows what it takes to get a company ready for sale. She advises running your company from day one as if you are preparing for sale. It’s just best practice.
Shannon has walked the walk, founding and selling two technology companies less than six years apart: Subserveo, Inc (Founded in 2008 * Sold 2011) and Paradata Systems Inc. (Founded 1995 * Sold 2006). She is also a self-described serial entrepreneur, best-selling author of 3HAG WAY and The Metronome Effect, speaker and CEO and leadership team coach.
“Businesses should always be ready for an exit. You can’t plan exactly when a sale will take place so you need to be ready at any time. In my first business, we ran it as if it was going to be sold from the first year. This may sound simple, but it’s easy to get pulled into the daily operation of the business and then not dedicate the time required to prepare for an exit,” she says.
The global pandemic has highlighted just how fragile the world economy can be, but Shannon encourages CEOS, entrepreneurs and founders to continue operating with best practices across the board to realize the best valuation.
“The exits we saw this year with the strongest valuations were not pulled together overnight. The founders had to start preparing years ago for the best valuation,” she adds.
In addition to emceeing TechExit West this November, Shannon is leading a session focused on the steps required to be M & A ready. She will share from her own experiences, including the good and the not so good lessons learned. Going through the list step by step, Shannon will explain what each stage means and offer recommendations for what level companies should be at for best valuation from a buyer. Attendees will leave the session ready for each phase in the process from strategy to integration.
The content is based on Metronomics Compound Growth System Shannon uses to coach CEO+LEADERSHIP teams around the world. It’s the same proven approach that worked for her, and one she generously shares in her speaking and coaching work through her company, Metronome United.
“Having led two exits, we didn’t all of a sudden decide it was time. We worked to prepare the organization well in advance. It is never too early to start thinking about your exit– it’s good practice,” she says. “Run your company as if you are going to sell it.”
A few of the key components of Shannon’s M & A checklist, include:
- Be crystal clear on your strategic value proposition and be ready to articulate it.
- Ensure your entire leadership team is in place, without vacant positions.
- For brick and mortar businesses, make sure your facilities are attractive. Prepare your space as if you were selling your home.
- Make sure your data is readily accessible and easy to share. This is especially key for information related to revenue, margins and cash.
- Share your growth plan and be ready to back it up with concrete data.
Shannon advises that whether a company is one year old or thirty years old make sure your organization is “scrubbed and cleaned” at all times so that if and when a potential buyer is interested, you are ready.