We would appreciate the opportunity to have call with you, or meet you for a coffee, so we can answer any questions you may have about Entrepreneurs Hub and our process. Here are some answers to the more frequently asked questions, but please feel free to call us any time on 0845 0678 678.
What size of businesses do you work with?
There is no barrier regarding size. Our clients are likely to sell at a price somewhere between
£2,000,000 and £50,000,000. See our recent success stories.
What sectors do you specialise in?
Our proven processes for preparing a business for growth or for exit can be applied to all sectors. We work very closely with our clients, get under the skin of the business so that we understand the business in detail, which then positions us well to market that business for sale.
Our teams have experience across a wide range of industries, including but not limited to: – Software, Consultancy Services, Manufacturing, Telecoms, Media, Technology, Construction, Engineering, Retail, Recruitment, Leisure, Online Businesses, Electronics, Service Sectors, Distribution and Logistics.
What about some free advice?
We believe one of the most important factors when selecting an adviser is about how well you relate to them and their team, and whether you believe in their process.
We normally start with an initial no-obligation call to understand your requirements in a little more detail and share with you some of our knowledge and experience. If we are all comfortable and there is some synergy, we would then suggest a confidential meeting at one of our bases (which also carries no obligation). This can be in Basingstoke, London, Birmingham or Manchester. Alternatively, we can come to meet you at a venue of your choice. During that meeting we will review your business for saleability and provide a guide on how much your business is likely to sell for.
We are passionate about sharing knowledge and we do this in various ways. Why not:
• Have a no-obligation face-to-face meeting. Contact us.
• Attend one of our webinars – ‘How To Build Value And Sell Your Company’.
• Call us now on 0845 0678 678.
What’s the process of selling a business?
Many companies fail to prepare properly before marketing their business for sale. The Entrepreneurs Hub approach ensures that the business is well prepared before we start marketing it.
The process is very logical, but there are a number of steps that need to be taken, so missing any of the key ones can lead to a negative outcome. There are also a good number of ‘known factors’ that will increase the value of a business. We will work with you on these specific areas.
Preparation, along with a clear and detailed research strategy to identify potential acquirers, is vital to a positive outcome. Entrepreneurs Hub manages the complete process, including the preparation of all the marketing material, material which must present the business in the right light – and most importantly – sell the future potential.
Using individuals with the correct skills at each stage of the process is crucial. These individuals include an experienced Project/Deal Leader, a Financial Analyst, Research Analysts, an Approach Consultant plus supporting back-office team. Each and every Entrepreneurs Hub client is allocated this team of experienced specialists that will work with you throughout the life of the engagement, providing critically important expertise at each and every step of the way.
Can I do it myself?
The process is very logical and therefore if you understand the process, you might well think you could “do it yourself”.
For many reasons Entrepreneurs Hub recommend against it. One of the main reasons is that you need to focus on your business and not let the sale process be a big distraction. It is essential that the business continues to perform well during the process.
In addition, it will at times become very emotional. At such points, having someone to ‘stand in the gap’ between yourself and the potential acquirer makes all the difference. Areas of the business that you are proud of will be discussed and challenged, and you will need guidance from an experienced team who understand what is important and what’s not. Not all such issues impact the sale, but some really do.
You may also wish to continue to work in the business for a time, post-completion. It is therefore important you maintain a good working relationship with the new owners. This can only be ensured if a third party, such as Entrepreneurs Hub, carries the weight in the negotiation stage.
I have already been approached, what should I do?
If you have been approached it is great news, but we would advise some caution. In our experience these type of approaches can often protract things substantially, making the process very stressful and pressurised. Some owners, on the other hand, end up being rushed into a sale despite their company being neither prepared nor positioned for the process.
If you only have one buyer in the process your position, as shareholders, is very vulnerable. Your buyer will know that they are in the strongest negotiation position – and therefore in control of the process. You can spend months pursuing an opportunity only to find it goes nowhere. However, multiple interested parties will have a huge impact on:
- the value someone places on the business.
- the terms you finally agree to.
- most importantly, the speed of the sale.
Our recommendation, almost always, is to add the firm which has approached you to the list of potential acquirers we identify for you. They should then be treated in exactly the same way as other potential acquirers. If they are serious about buying your business, this will soon become apparent. Having other interested parties will only have a positive impact, both on the price and the terms you are likely to achieve. The client below had such an approach and chose to engage the Entrepreneurs Hub Team to handle it. This is what they said afterwards:
“Just a quick note to say many thanks for all your help and advice over the past year. I have no doubt partnering with you guys added significant value to the business and helped us achieve a wonderful result yesterday.”
If you have had an approach from an acquirer, please do talk to us. Wherever you have got to in the process with them, there’s usually something we can do to help.
How long does the process take?
It really depends on the complexity of the deal and the readiness of business, but on average we would say the process takes around six to twelve months. In some cases, it can take a little less time and in other cases a little longer.
In parallel with preparing the business for sale, Entrepreneurs Hub carries out detailed research and identifies a number of potential acquirers. You will have early sight of, and approval of, this list prior to any approach. Once the business has been prepared for sale – which is typically the biggest variable – we are then in a position to start marketing it for sale. You are likely to start seeing initial interest within a few months. Further qualification should lead on to face-to-face meetings within a further month or so.
Once the initial meetings have taken place – arranged and facilitated by Entrepreneurs Hub – you will start to receive initial offers. Around this time, we explore the synergies of the two organisations coming together. At some point you will need to make a decision whether to accept an offer or not. It’s at this stage you will need to enter an exclusivity period, where the acquirer carries out their Due Diligence (DD) on the business.
This DD period varies according to the complexity of the business, but typically takes between two to three months. Upon completion you will have sold you company.
How much is my business worth?
You will no doubt of have heard the phrase “Your business is worth as much as someone is prepared to pay for it”.
We don’t advertise a price when marketing a company for sale. Our process ensures that we present the interested parties with all of the necessary information to assess the value of your business in light of future potential and synergies. They are then encouraged to present an offer based upon what it’s really worth to them.
How can I get a valuation on my business
As explained above, we don’t put a price tag on a business when we take it to market. Instead, we let the market decide the value. However, it’s still important to establish a guide valuation range. That way you can decide whether or not you are likely to achieve the valuation you would like, before you start marketing the business for sale and incurring related costs. It will also assist in assessing indicative offers when they start to come in.
As part of our process, we research the industry sector, then review your own financials in order to carry out a desktop off-market valuation. This provides you with that guide range of valuations. This ensures that you gain the necessary confidence that you are entering the process appropriately, and that your desired aspirations are achievable! We do not want to take a company to market unless we are confident there is a market for that business, and we believe we can achieve our client’s desired goals.
How do you find buyers?
This is the most important part of the process we carry out at Entrepreneurs Hub. It involves comprehensive research both in the UK and overseas to identify the right kind of potential acquirers. We have access to details of millions of companies globally. If you choose to meet with us, we will tell you more.
We have dedicated researcher analysts who create a potential buyer profile for our client’s business. They research ideal acquirers that fit that profile, and then are able to present 50 – 100+ potential acquirers for our client to approve.
What about confidentiality?
This is often one of the first questions we are asked! Entrepreneurs Hub takes confidentiality very seriously indeed. Throughout the process, the protection of your confidentiality remains high on the agenda, being taken into account at every stage of the process. We are extremely guarded about releasing any information to potential acquirers and all approaches are initially made anonymously.
We agree with our clients the best forms of communication to protect internal confidentiality, whether that’s by email, mobile phone or by written correspondence. Our clients have sight of every document – approving or amending as necessary.
Prospective acquirers have to be approved by our client before any approach is made. They also must sign a Non-Disclosure Agreement (NDA) before any further information is shared, including the name of your business.
If you would like Entrepreneurs Hub to complete a Non-Disclosure Agreement before talking in detail, please let us know and we will happily send you one across.
What guarantees do you provide?
As a matter of integrity, we cannot promise we will sell you company. There are too many variables in your control and not in our own. However, we only work with companies that we have a high degree of confidence that we can sell. Thus, we look at this before we engage, and promise that we will be honest and open in our response to you.
Remember that as we prepare your firm for sale, we want to help make it stronger and more robust. This increases both the likelihood of a transaction and the value of your business. The more ready your business is for exit, the more chance you have of selling it first time, but all the improvements made will be lasting ones, whatever happens.
Why do I need to prepare for exit?
Many businesses fail to sell in the first instance not because they are a bad business, but because they are not properly prepared.
By preparing the business before marketing it for sale, we can help you strengthen it by reducing any perceived risks, thus making it more attractive to buy. It also potentially increases the price you can achieve. It helps with the sales and negotiation process and potentially attract more interested parties.
Get an adviser like Entrepreneurs Hub involved as early as possible to assist you in the preparation process. This ensures you focus on the areas that will increase value and positively impact the process.
How much of my time will it take?
We try to minimise the impact on you so that you can concentrate on running the business and driving it forward.
In the first few months you will need to allocate two or three days to the project. It takes a few hours to complete our Pre-Diagnostic Questionnaire, which starts to gather useful information on the business. The Discovery Day is the true project kick-off, where our team start getting under the skin of the business to truly understand the detail.
Beyond this, we recommend you allocate half a day a month to process any requests and enable us to keep you informed of progress.
At the back end of the project, once we have interested parties, you will need to attend face-to-face exploratory meetings with the prospective acquirers. The level of interest generated will determine how much time you will need to allocate to that part of the process. However, we will always try to be as efficient as possible with diaries. We recognise you have a business to run.
How do you charge?
The major part of our fees are based upon the successful completion of a sale. Our interests are aligned with yours – you win, we win. We receive a success fee when your business is sold. Those fees are paid to us when you are paid.
We do charge a small retainer which is spread across several months at the front end of the process. The retainer is subject to the complexity of the business and its readiness for sale. It helps cover some of our expenses, but our goal is to achieve a successful sale, because that’s when we all win, and where Entrepreneurs Hub makes money.
We like to work with companies that we have a high degree of confidence that we can sell.
Can I get a reference?
You may have seen we have numerous testimonials on our website which should provide you with a flavour of the type of company we are. They often refer to our core values as a business driven by integrity, approachability and results. But, YES of course you can talk to some of our clients. Everyone on our list of clients is prepared to be a reference.
I’m not ready to sell – why should I start planning now?
Preparation is key to an eventual exit from your business. The earlier you start preparing the business in terms of financial and general reporting, documentation, accreditations, contracts and much more, the smoother the process will be. The business will become more robust as a natural part of our preparation process. So, when you are ready to exit, or in the event that you have an unsolicited approach, you can be confident you have done everything needed to maximise the value of the business.
Take a look at your business. Understand why a potential acquirer might buy you. What is it that makes you a good acquisition target for them? Is it your brand, client base, IP, products or services, your skilled team, your niche offering – or something else? If you identify both your strengths and your weaknesses, you then have time to make changes that will both have a positive impact on the business and maximise the potential value you achieve when you sell.
What will happen to my employees?
If you are like most business owners, you will be concerned about your staff and how they will be looked after following your departure. It’s only natural after all. You may have been working with some of them for thirty or forty years – or more, and they may have become ‘part of the family’.
In many cases, becoming part of a larger organisation can create additional opportunities for your staff, rather than being a cause of concern.
With our process you have full control over who you end up selling the business to. As part of it, you will meet the prospective new owners, and often it may come down to who you feel most comfortable with. These candidates will probably have similar values to yourself or have provided you with sufficient confidence that they value your staff and will look after them.
Who is most likely to acquire my business?
Unfortunately, we are unable to see into the future. But what we can do is influence the outcome! As part of our process, we will carry out comprehensive research to identify a list of potential acquirers that fit the correct profile to acquire your company. We will proactively approach them, presenting the acquisition opportunity.
There will be some obvious companies on the list – companies from your industry, a similar organisation to yourself, and so on – but in our experience such companies often do not acquire the business. Nonetheless, these obvious companies do need to be on the list. However, our researchers are eager to look ‘outside the box’ and we spread our net far and wide. On most occasions our client was previously unaware of the acquiring company – or never thought they would be interested.
I am interested in selling my company what next?
For most owners, their business is the most valuable asset that they will ever get to sell. Our counsel is to avoid being drawn in by the sparkle. If you think the value someone places on your business is too good to be true, then talk to us. We will be honest with you, not just telling you what you want to hear, but instead what you need to hear.
To book a no-obligation call or meeting with an Entrepreneurs Hub director, call or email us.
We would love to help you explore the journey. But whatever you decide, we wish you the very best in achieving your goals and aspirations.
What is an Employee Ownership Trust (EOT)
Employee Ownership Trusts (EOTs) are a government incentive designed to promote employee ownership by allowing business owners the opportunity to sell their shares to an employee-owned trust. The proceeds of such a sale are free from capital gains tax.
Find out more about the benefits of an EOT.
Why should I talk to Entrepreneurs Hub?
We are entrepreneurs ourselves we have walked in your shoes and have been established for over 10 years and have an excellent track record. We will not sell you sparkle or over inflated valuations just to lure you to engage with us. We won’t charge you for an initial business review or guide valuation range. We will provide you with honest straightforward advice. We believe you will see after an initial conversation that we are very different from our competition. What do you have to lose? Contact us now.
What is a disclosure?
A disclosure letter in a business sale is an important part of the transaction which is prepared by the vendor’s lawyers after the SPA has been drafted. In this important part of the sale process, the seller discloses information which has not been requested by the acquirer during the Due Diligence in order to protect the vendor from a post-transaction warranty claim.
Disclosure can be a contentious part of the business sale process as buyers may try to re-negotiate or chip the price after certain disclosures are made. However, although a disclosure pre-sale may result in a ‘price chip’, failure to disclose anything that is then identified post sale, may well result in a legal claim.
What are Heads of Terms documents?
Heads of Terms (HOTs) or a Letter of Intent (LOI) set out the main terms of a business sale reached between the vendor and the acquirer in a transaction. Following the initial negotiations HOTs are prepared to identify the agreed terms of the sale before the final details are negotiated.
Heads of Terms are rarely legally binding. However, although it does not enforce obligations on them, the document exists to record the future intentions of parties wishing to take part in a business sale.
What is an Earnout?
An Earnout is a contractual agreement whereby the seller of a business is to receive additional compensation in the future if the business achieves certain financial targets. These can be received as a lump sum payment or as a percentage of the future profits.
What is a deferred payment?
As part of the sale process the buyer and the seller may agree that some of the Consideration (the price paid for the business) may be paid in the future on set dates. This allows the acquirer to make these payments out of future profits. It can be a win-win for both the acquirer and the seller. It may save the acquirer having to fund the purchase price with expensive borrowing. It will often also secure the vendor a higher price for their business.
We’d love to hear from you
Now you’ve learned a bit more about our services, please get in touch to find out how we can help you achieve your goals.