Reaching Out for Help

Reaching Out for Help

The quest to become an entrepreneur by purchasing a business is about learning and continuous improvement. No search is the same, nor is any searcher, therefore you have to seek out solutions to the challenges you face along the way, apply them to your own search process and rigorously improve them until you finally close on a business.

Learning from others is critical to this endeavor. However, the “search” field is so unique and limited in size that there are very few experts to guide you and offer advice along the way. Investment bankers, private equity experts, investors and SME owners themselves just find it very hard to relate to your journey. It is critical therefore to develop a peer group of other searchers to both accelerate your learning and provide vital support for your journey.

Reluctance by searchers to share

Early on in the process, searchers seem reluctant to share information and reach out to other searchers. Andrew Mondi of Lyndhurst Capital reflects “I did not prioritize corresponding with other searchers for the first 6 months of my search. I didn’t understand the value of it…I wish I had.”

After making the decision to acquire a company, the increased feelings of autonomy and independence seems to get in the way for many searchers from reaching out and asking others for help. Launching the search is fraught with a myriad of decisions and you may just want to get started and don’t have the time to seek assistance. It may also feel like diminishing your “uniqueness” to take advantage of what another searcher, a year ahead of you may have agonized for weeks over.

These days, one of the principles of “lean” thinking is the concept of benchmarking, which legitimizes this “borrowing” of best practices. After all, it is not the idea that is critical, but how to execute it that determines a successful outcome.

More frequently, searchers feel that they will be competing with each other over the same “owners” and develop FOMO. In practice, however, there are very few reported cases of multiple searchers bidding on the same business and in some instances sellers may simply mis-report that “another searcher is looking at me”.

Creating and nurturing a variety of support searchers

Before one decides to follow this arduous path they will likely have spoken to 30-50 searchers who are in various stages of their own search process. Pick no more than six from this group, and recruit them into your peer group. This group can form the basis for establishing a long term relationship with a selected few, but no more than a half dozen.

Following the 0-1-3 rule, select two from your current year’s cohort, two from those who are 12 months ahead of you and, finally, two that are already running a business for more than a year in fields of interest to you. At least one of your cohort should be from you own geography. Alex de Pfyffer of Heritage Holding reports “We relied on searchers in the class above to teach us best practices and share their experience.”

Work with searchers who are following a similar path to yours, as Adam Barker who self-funded New Forest found, “It was hard for me to relate to funded searchers as they have a different strategy.” For the more experienced peers who are a year ahead of you, ensure that they have completed at least 2 LOI’s to give you some guidance about what to avoid.

As with any relationship, it takes effort and both a “give” and “get” to leverage these peers. One searcher established a regularly scheduled call, and was sure to include them on the quarterly update email. It is best that you prepare an agenda of issues to cover that include prospecting, managing interns, dealing with sellers, raising financing, negotiations and creative solutions to roadblocks.

Ask for examples to benchmark against. Reach out and call. Emails and conference calls are too impersonal and some find it intimidating to share with an audience that can’t be seen. Even group meetings have a tendency to just be social events and inefficient ways to share.

Be selective on who else you reach out to

Getting tactical search advice from people who don’t have expertise in the search model and aren’t following your search closely, even if they have extensive business expertise, may leave you feeling like they don’t understand the real nature of your problem nor provide realistic solutions. It is better to seek strategic and industry specific counsel from these wise outsiders.

Lars Gehre at Green Vault observed, “Most of my advisors had a close friendly relationship with me or were professional private equity investors and were not that helpful with their advice, however they made introductions to others who I thought would be better to provide advice.” Another related that “The Private Equity senior colleagues that I thought would have some expertise were very slow in responding to my outreach.”

Even some of your investors may not be appropriate sources of sound process guidance, as one searcher found, “I could not be vulnerable with most of my investors. I had to be sharp, be prepared, and have all the answers. I felt they would be judging my progress”. Other investors don’t want to engage until you have a signed LOI.

However, just relying on peer searchers is dangerous, as Adam Barker observed, “It was generally better to seek out people with the complete opposite viewpoint to ourselves, listen to their view, and try it out. You just have to understand their perspective.”

Be prepared to “give back” to the community

Those considering following in your footsteps may reach out to you for advice around how you made your own decisions to undertake a search. Ben Murray at New Forest says, “Anyone who asked I told them everything and shared everything, it is therapeutic.” Marc Cussenot, a self-funded searcher/CEO of Precision Concrete Cutting, pointed out: “I have one call per week in average with new or prospective searchers who are looking for advice.”

Offering to help prospective searchers to see how the “sausage is made”, is a great way to give back and much more effective than a phone call. Alex de Pfyffer observed that “We took on MBA interns for a week at a time and put them to work while they were considering this career path.”


As with many components of a successful search and acquisition, this is a process. Trying to do it alone is a recipe for narrow thinking and diminished creativity. Having a community to draw from which has very directed expertise, will both give you new ideas and also prevent you from making needless “rookie mistakes” along the way.

Search on!

Feel free to share some of your own best practices or experiences in dealing with these issues in the blog comments. I encourage comments and dialog, allowing all to learn from both my views and the views of others – a virtuous learning cycle. Jump right in! I regularly update individual blog posts, add to the Reference section and Search tips, so visit the website regularly.

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  1. Andrew Mondi on May 26, 2016 at 1:12 pm

    Jim – thanks for this post. Very important topic. Most searchers are competitive people and are attracted to the idea being somewhat independent CEOs. These two forces can easily pull a searcher away from really valuable resources – most notably other searchers. I particularly like the thread on reaching out to a variety of searchers including those that are “ahead of you” and may have already closed a deal and those that are at a similar stage. This is particularly valuable for two reasons.

    First, sometimes a solution to a problem a year or two ago, might not be optimal. Consider rapid changes in attitudes and trends in the lending community, and challenges around healthcare and employee benefits. Discussing conventional wisdom with your “peer” searchers can help confirm or challenge a point of view on these matters.

    Second, I found reaching out to searchers “ahead” of me helped assess risk vs. reward in ways I did not expect. I noticed that a searcher’s input was strongly influenced by when their search was started relative to the economic downturn of 2008. Whether a searcher began prior to the downturn, during the downturn, and after the downturn typically yielded starkly different ways of identifying and thinking about risk. I also noticed that attitudes toward risk changed again in the most recent groups of searchers…I suspect this may coincide with when search began being formally taught in schools.

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Random Quote

45-“Strategic partners” are very important to the business searchers.You want to rely on some trusted providers to support your business, you can’t do everything yourself!(See Blog Post-Strategic Partnerships)

42-Start early on legal documents, they often delay closings while under LOIBoth the searcher and the seller are plowing new ground and it takes a while to comprehend the meaning of all of the legal details .(See Blog Post-Getting to closing)

63 Searchers make promises they can meet to build trust with sellers. It is important to provide incremental opportunities to show that you can be counted on to deliver.(See Blog Post-Building Trust with Sellers)

34 Searchers who get access to employees before closing are more likely to close. Once the seller begins to confide in their employees about the sale of the business and introducing you as the “new owner”, they are more likely to proceed to finalize the transaction than to change their mind at the last minute.(See Blog Post-Getting to Close)

07-You are not a PE firm, don’t act like one!
Potential sellers resonate with your taking over their legacy, a PE firm is simply adding to their portfolio. Make sure your website looks personal and non-intimidating.

04-Fight Seller Fatigue in Due Diligence!
Sellers get worn out in this process. It is highly emotional for them, probably their first time at relinquishing their “baby” to someone else. During LOI stage, make it a practice to communicate with them, in person or by phone, every 2 days.

53-Holding monthly “all-hands” meetings indicates your transparency. Trust employees with what is going on with the business and they will trust you more .(See Blog Post-Communicating with Employees)

06-Use metrics to drive decisions
Track what is most important for your search – getting in front of prospective sellers to make offers to buy their business. Track the number prospects, IOI’s, LOI’s and set goals for yourself! If you measure it, you can improve it.

22-When in conflicts arise, remind professional advisors they work for you.
Inevitably, you will disagree with some advice you are getting. After checking multiple sources, do what feels right to you and move forward. You will have to “live” with your own choices, not the professionals!(See Blog Post-Professional Support)

18-Every day that goes by during Due Diligence raises the chance that you won’t close!
Time is of the essence when it comes to moving from a signed LOI to closing on your business. Seller fatigue sets in as the closing date gets extended and the seller constantly re-evaluates their motivation to sell. Only you can push the process along.(See Blog Post-Due Diligence)

44-Plan ahead, give thought to the small details of how you present yourself as the new owner. The first introduction to the employees of the business has a huge impact so you want every word to be rehearsed!(See Blog Post-Taking over the business)

50-Don’t expect immediate “loyalty”, the previous owner earned it, it takes time. You will need to earn the trust of your employees by your actions, not your words. (See Blog Post-Seller Tranisition)

35-Searcher CEO’s need to be prepared to walk away from volume orders if margins will decline. It takes a forward thinking CEO to seek out higher margin, value added opportunities to grow profits, not revenue.(See Blog Post-Wearing the sales hat)

09-Learn from others – read case histories
Over 40 case histories have been written about funded and self funded searchers in a variety of industries and historical settings. Each have great “lessons learned” and are worth the $10 cost to read them. Searchers are learners!

39-The business seller is “hiring” you to run their business. The owner trusts you enough to turnover the “legacy” of their business to you. (See Blog Post-Searcher Profile)

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