Full Time Predators and Part Time Prey
If you're a founder going into a sale or financing transaction without professional advice, it's important to understand that your buyer is probably a full-time predator (they do this every day) and you are part-time prey (you'll probably only do this 1x). You need protection - a professional shield and maybe even an army on your side.
Protecting Yourself as a Founder in a Sale or Financing Transaction
In the fast-paced world of business sales, founders often encounter experienced buyers and investors who negotiate deals regularly. As a founder, you might only engage in such deals once in your lifetime. Without proper guidance, founders can easily fall prey to these seasoned buyers. Here's how to protect yourself and secure a fair deal:
Know Your Limits: Understand that negotiating deals may not be your strong suit as a founder. Recognize the need for professional help.
Get Expert Help: Hire a skilled attorney or investment banker to represent you. They'll handle negotiations and protect your interests.
Build Your Armor: Consider adding more professionals like accountants and financial advisors to your side for extra support.
Start Early: Don't wait until negotiations are underway to seek help. Prepare in advance to navigate the process effectively.
Stay Informed: Learn about key financial terms, like Adjusted EBITDA, and concepts to be an active participant in negotiations.
Negotiate from a Position of Strength: With your team behind you, negotiate confidently and stand firm on fair terms.
By taking these proactive steps and investing in professional guidance, you can level the playing field and protect yourself from falling victim to full-time predators in the deal world. Remember, it's your business and your future on the line - make sure you're prepared to fight for what you deserve.
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