Billy Fink, Marketing Manager at Axial just published a great article in LinkedIn entitled “M&A Advisors Proven to Improve Valuations“. He states that advisors, 1) create competition in the sales process, 2) are more important in private transactions and 3) provide extra-valuation benefits. And he is exactly right — a good M&A advisor should create far more value to the seller than the fee paid. This opens up another area for discussion: What is the proper role for third-party advisors when growing & ultimately selling a business? You’ve probably met the CEO who insists that he/she can do the accounting, corporate legal reviews, raise money for the business, be the H/R director and find the right buyer for the business. If you’ve met this person, you know that this CEO is wasting precious resources. Even if the CEO is multi-talented, if doing the accounting is his/her best use of time, then the business has real problems. Mr. Fink’s article hits a cord with M&A advisors. I’ve met lots of CEOs who think they will “save money” by doing it themselves. What typically happens is that business is never sold, or if it is sold, a LOT of money has been …
