A time-honored truth for the M&A industry is the importance of securing the advice and guidance of experienced professionals in this field. Many business owners do not initially understand how much goes into this process. That is why we host complimentary executive conferences across the country, which offer a helpful overview. Indeed, numerous owners we’ve met in the past who sold their companies without professional guidance have said how they wished they had the kind of support Generational Equity provides when selling a company.
The reason for this is simple: the knowledge that you are working with an advisory firm convinces buyers they may need to pay a premium for your business.
An M&A consultancy firm for business owners looking to sell is like the navigator on a ship. They help you reach your destination as quickly and smoothly as possible, all with the aim of discovering your ‘treasure’: the optimal value for your company.
On your journey, your professional team will help you navigate every stage, including the subject of this piece: a limited auction. A limited auction (also known as a targeted or controlled auction) plays a pivotal role in maximizing the value of your business among buyers, and helps to identify the ideal buyer for your company going forward.
So, what is a limited auction? As Divestopedia notes:
“A [limited] auction is a process which focuses on a limited amount of bidders for an acquisition of a company… A targeted auction weeds out buyers that are not a fit quickly compared to a broad auction which approaches all potential buyers in the market regardless of fit.”
Therefore, once your company is ready for sale (the end goal of our process to build a ‘buyer-ready’ business), our dealmakers at Generational Equity will setup a limited auction, creating a competitive bidding environment that will invariably increase your company value. Generating this atmosphere in front of carefully-selected strategic and/or financial buyers will instantly make your business more sought-after.
A limited auction is not the only sales process available to those selling their business: there are also broad auctions (which have a large volume of bidders) and targeted solicitation (approaching a smaller group of buyers). While all three have advantages and disadvantages, there is a reason why limited auctions are the preferred approach in middle-market M&A. That is because it provides the best overall solution to the following concerns:
For instance, a broad auction places your business in front of more prospective buyers. But, this is more likely to compromise the confidentiality of your company’s status. On the other hand, targeted solicitation is significantly more confidential, but no competition means you are unlikely to secure the optimal price for your business.
A limited auction offers the best of both worlds, and is the ideal approach to securing the right deal for your business. Your business is presented to a reasonably small but highly interested group of buyers, you minimize the risk of confidentiality, and improve your odds of identifying the right buyer in the shortest time.
This is especially true if you are working with skilled professionals, like our team at Generational Equity.
Because setting up a successful limited auction relies on two important details:
Our approach covers both considerations. Our comprehensive valuation process and regular communication with clients ensures that we know what they are looking for, which determines the buyers we include in the auction. In addition, thanks to our extensive database of over 34,000 business buyers, we have the resources to identify what buyers will be the best fit for your company.
We maintain a strong relationship with buyers through DealForce, our proprietary, effective middle-market portfolio of businesses across a broad range of industries. And, thanks to our reputation in this market, when buyers learn you are working with us, they are inclined to increase their bids compared to what they would offer if you were approaching this alone. Even the illusion of a limited auction can be a powerful tool in securing the best deal for your company.
If you’d like to discover more about limited auctions and other elements of our dedicated M&A process, attend one of our executive conferences. Here, we discuss how to develop a successful exit strategy, from an initial valuation and enhancement techniques, all the way to deal closure. In addition, you can discuss your goals with our experienced professionals, who are keen to learn more about your business and where you see yourself in five years, ten years and beyond.
For more information on our process or to find an executive conference near you, contact us today on 972-232-1121.
The information we learn from customers helps us personalize and continually improve your experience. Here are the types of information we gather.
We receive and store any information you enter on our Web site or give us in any other way. We do not sell or rent your personal information to others without your consent. We use the information we collect only for the purposes sending promotional information, enhancing the operation of our site, serving advertisements, for statistical purposes and to administer our systems. We DO NOT use third parties to provide customer service, to serve site content, to serve the advertisements you see on our site, to conduct surveys, to help administer promotional emails, or to administer drawings or contests, but reserve the right to do so in the future without advance notice.
Generational Wealth Advisors’ affiliates are all part of one corporate family, they work with one another and may work together to provide services to you. The sharing of your information among affiliates enables Generational Wealth Advisors to serve you more efficiently and makes it more convenient for you to do business with Generational Group. Generational Wealth Advisors is permitted by law to share information with its affiliates. All of our affiliates follow similar privacy policies.
For reasons such as improving personalization of our service, we might receive information about you from other sources and add it to our account information.
Generational Group may license the use of its intellectual property including but not limited to its name, likeness, and logo for the use of affiliated offices. Such affiliated offices may not be owned, controlled, managed, supervised or staffed by employees, officers, or agents of Generational Group. Affiliated offices may be independently owned and operated. For more information about a particular office, please contact Generational Group at its office in Dallas, Texas.
This page may contain other proprietary notices and copyright information, the terms of which must be observed and followed.
Information on this web site may contain technical inaccuracies or typographical errors. Information may be changed or updated without notice. Generational Group may also make improvements and/or changes in the products and/or the programs described in this information at any time without notice.
Generational Group does not want to receive confidential or proprietary information from you through our web site. Please note that any information or material sent to Generational Group will be deemed NOT to be confidential. By sending Generational Group any information or material, you grant Generational Group an unrestricted, irrevocable license to use, reproduce, display, perform, modify, transmit and distribute those materials or information, and you also agree that Generational Group is free to use any ideas, concepts, know-how or techniques that you send us for any purpose.
Our computer system protects personal information using advanced firewall technology.
Information Generational Group publishes on the World Wide Web may contain references or cross references to other products, programs and services that are not announced or available in your country. Such references do not imply that Generational Group intends to announce such products, programs or services in your country. Consult a Generational Group representative for information regarding the products, programs and services which may be available to you.
Generational Group makes no representations whatsoever about any other web site which you may access through this one. When you access a non-Generational Group web site, please understand that it is independent from Generational Group, and that Generational Group has no control over the content on that web site. In addition, a link to a non-Generational Group web site does not mean that Generational Group endorses or accepts any responsibility for the content, or the use, of such web site. It is up to you to take precautions to ensure that whatever you select for your use is free of such items as viruses, worms, Trojan horses and other items of a destructive nature.
IN NO EVENT WILL Generational Group BE LIABLE TO ANY PARTY OR ANY DIRECT, INDIRECT, SPECIAL OR OTHER CONSEQUENTIAL DAMAGES FOR ANY USE OF THIS WEBSITE, OR ON ANY OTHER HYPERLINKED WEBSITE, INCLUDING, WITHOUT LIMITATION, ANY LOST PROFITS, BUSINESS INTERRUPTION, LOSS OF PROGRAMS OR OTHER DATA ON YOUR INFORMATION HANDLING SYSTEM OR OTHERWISE, EVEN IF WE ARE EXPRESSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Furthermore, all information contained within this website is the property of Generational Group.