Considerations When Selling
When we prepare your business for sale, we look at the financials, but we also look at Owner Dependence. If your business cannot function for 30 days without your direct involvement, it is a high-risk asset that may scare buyers away.
We can help you develop a 2nd-in-command or a leadership team. We can help you document your processes. Buyers want to purchase a sustainable “money-making machine,” not a 60-hour-a-week job.
If you are selling a “fixer-upper,” we can help you assess offers to give you the fastest and best exit.
Phase 1: Preparation & Valuation
1. Initial Discovery & Prequalification: After a potential seller contacts WHC, we conduct a high-level interview to determine the seller’s motivation and timeline. We work to understand the “story” behind the business. We prequalify the business internally to ensure it meets our Acquisition Criteria (e.g., EBITDA of $250k–$5M).
2. Financial Recasting & Valuation Analysis: We collect three years of tax returns and P&Ls. We perform a “recasting” of the financials to identify Seller’s Discretionary Earnings (SDE) by adding back one-time expenses and owner perks. We apply industry-standard multiples to provide the seller with a Most Likely Sales Price (MLSP). We provide operational and technical coaching to help you implement changes that will increase the value of your business.
3. Execution of Engagement Agreement: Once the seller agrees on the valuation range, we sign a formal Listing/Engagement Agreement. This document outlines our commission structure, the exclusivity period, and WHC’s role as the lead broker and possibly the lending advisor.
Phase 2: Marketing & Vetting
4. Creation of Marketing Materials: We draft the Blind Teaser (for public listing) and the comprehensive Confidential Information Memorandum (CIM). We ensure the CIM highlights the “consulting” value—such as AI growth potential—that a buyer can leverage post-purchase.
5. Strategic Listing & Targeted Outreach: WHC lists the business on professional exchanges and taps into our WHC Partner Network. We reach out to strategic buyers in our database of pre-qualified entrepreneurs who are looking for businesses in that specific industry.
6. Buyer Vetting & NDA Management WHC handles responding to inquiries by requiring a signed Non-Disclosure Agreement (NDA) and a Proof of Funds (POF). Only then do we release the CIM. WHC conducts confidential interest calls to ensure the buyer has the management experience necessary to be approved by a lender later.
Phase 3: The Deal & Closing
7. Offer Negotiation & LOI Execution WHC manages the “bidding war” if multiple buyers are interested. We review Letters of Intent (LOIs), focusing heavily on the deal structure (cash vs. seller notes). Help the seller select the buyer with the highest probability of closing.
8. Due Diligence & Loan Packaging While the buyer performs their Due Diligence (using our checklist), we simultaneously build the Loan Package for the lender. By managing both sides, you ensure the lender’s underwriter doesn’t find anything the buyer’s CPA missed.
9. Purchase Agreement & Final Contingencies We work with the M&A attorneys to move from the LOI to the formal Asset Purchase Agreement (APA) and resolve any “findings” from due diligence (e.g., equipment repairs or price adjustments) and ensure the lease assignment or franchise transfer is approved.
10. The Closing Meeting & Handoff We coordinate the final meeting where all parties sign the transfer documents, the lender funds the loan, and the keys are handed over.
Have questions? Ready to start?