There’s no shortage of technical advice on how to sell a business. What’s much harder to find is an honest account of what it’s actually like to sell the business you’ve worked so hard to build over the years. Much like the arrival of a first child, there’s little that can prepare you for the practical and emotional roller coaster.
Ben Gordon is co-founder of OK COOL, one of the most exciting agencies to have emerged from the creator economy space in recent years. In January, at the height of its fame and influence, OK COOL captured sector headlines by announcing it was selling to Residence, a PE-backed creative group that is rapidly making a name for itself.
A few months on from the relief of signing on the dotted line, we invited Ben into the Waypoint podcast studio to reflect on his first M&A experience.
In this conversation with Waypoint partner Matt Lacey, Ben gives an unvarnished account of some of the highs and lows of the process. Listeners are invited to peek behind the curtain to witness the joy, the desperation, the sheer hard work and the cliff hangers, all part of the drama of getting a deal done.
Even a deal that feels like it’s pretty much at the goal line – which Ben and his fellow owners thought was the case with Residence – can quickly reveal any number of twists and turns and ‘scary moments’ once the formalities involving lawyers and due diligence gets underway.
Here are Ben’s key pieces of advice for anyone considering selling their agency, things he wishes someone had told him and his team at the start of their journey:
Does your buyer want what you want?
Most M&A approaches come at the point when a business is absolutely flying – which was definitely the case with OK COOL. That means you have to be completely certain that the business you’re joining is one that shares the same values and genuinely wants you to grow even faster than you would have done without them.
Have you researched your buyer inside out?
If you’re embarking on a process involving a number of suitors, one of the most valuable things you can do is carry out exhaustive research on them.
If one is offering you a multiple that seems too good to be true – make sure that they have the means to deliver on it. Or maybe it comes with strings attached, such as over a really long burnout period with nigh on impossible targets to hit. Speak to other founders who’ve joined that particular business to understand their experience.
The right kind of advice can make or break a deal
You might think you can do a deal without advisor – and you can – but the deal Ben and his team thought they had when they took Waypoint on was vastly improved by their involvement.
And once the lawyers get ‘lawyering’ you’ll find yourself facing Issues you could never have foreseen In language that’s quite often impenetrable At that point it’s great to have someone on your side who’s done it all many times before and can act as an extension of your team, not just for the deal process, but several years into the future as you do your earn out.
But not just any advisor will do. Make sure they have a verifiable track record in your space and are the sort of people you can imagine spending hours and days with as you get the deal over the line, often taking calls at ungodly hours especially when the deal is a global one covering a number of jurisdictions and incompatible time zones!
A large part of deal making is about relationships – the one you build with the buyer and the one you’ll want with an advisor who will not only secure a great deal in the here and now but also support your future growth prospects within your new ownership structure.