Maximising deal value and completion probability

We're telling a story.

Maximising the value of a transaction and the probability of its completion go beyond simply presenting a business as-is. It requires a strategic approach to highlight the full potential and depth of an opportunity. We'll run through a few concepts below that we consider very carefully when preparing to go to market.

We start from the beginning

A successful transaction begins with a clear understanding of the business's history, its objectives, and its market position. This context is crucial for framing our client's story in a way that resonates with the audience we'll be approaching.

Our team typically begins by running through every aspect of the business in detail, looking for ways to optimise and present it in the best light. We consider and plan the objectives of the deal: Why are we seeking investment or a sale now? What milestones have led to this point? And where can it go from here?

By meticulously understanding the key aspect of the business, we collectively identify opportunities for improvement that could potentially enhance its value and increase the probability of a successful deal. Even if most of those initiatives end up as part of the forecast, highlighted for an investor or acquirer as part of the business potential, this can still have a significant impact on the business value.

Are there any low-hanging fruits?

In the process of understanding the business layer-by-layer and preparing for a successful transaction, we often identify opportunities for immediate improvements—often referred to as "low-hanging fruits." These are actions or changes that can be quickly implemented to enhance the business's value and attractiveness before going to market.

Identifying these low-hanging fruits is central to our strategic preparation. By addressing these opportunities, we can make substantial renovations with leveraged effort and within a short timeframe, thereby increasing the potential for a successful deal.

If there are, could we capitalise on any of those initiatives within a timeframe that aligns with executing targets? Sometimes, a few months' work in the right direction can make a dramatic difference to a deal outcome.

We collectively cover all aspects here, from revenue, pricing model, product/service, tech, online presence, to operations, growth plans, customer relationships, and the team.

Any areas that cannot be addressed prior to going to market are incorporated into the narrative, emphasising the business’s potential and upside for prospective acquirers or investors.

Is the business positioned in the best way it could be?

Through our strategic optimisations and immediate initiatives, we often discover ways to reframe different aspects of the business for stronger overall positioning. There are many aspects to present about a business, and each can be framed from numerous angles. By carefully selecting the most appropriate perspective, we can highlight the business's unique strengths, optimised financials, and strategic growth plans. This refined framing helps reflect the full potential of the business, making it more attractive to potential investors or acquirers, and increasing the likelihood of a successful transaction.

Where can we go from here?

Part of our strategic preparation involves exploring all potential paths forward for the business. This includes evaluating a range of growth strategies, from organic expansion to mergers and acquisitions. By thoroughly examining these options, we can map out the ideal path that aligns with the business’s goals and market opportunities.

Once we have identified the optimal route, we translate this strategic vision into a comprehensive financial model. This model not only captures the current financial health of the business but also illustrates forecasted growth and value creation under different scenarios. It serves as a roadmap, guiding the business toward its objectives and providing potential investors or acquirers with a clear understanding of the future potential.

Is the business ready to deal?

Being ready to deal means having every aspect of the business in order, from legal and financial documentation to operational readiness and risk mitigation. This thorough preparation helps to streamline the due diligence process, reducing potential obstacles and facilitating a smoother, faster transaction. By taking these steps, we increase the likelihood of a successful outcome and maximise deal value. Collectively, we put ourselves in the shoes of potential counterparts, consider what could come up later in the process, and plan well for it.

In parallel, we save time and start on deal documentation

While we work with our clients to position the business in the best way possible, we also start preparing an information memorandum for the business. This crucial document serves as a narrative that tells the company's story, highlighting its strengths, strategic vision, and future growth potential. By aligning our positioning efforts with the development of the information memorandum, we ensure that every aspect of the business is presented cohesively and compellingly, increasing the attractiveness and appeal to potential investors or acquirers.

Some points to consider when drafting the information memorandum:

1. Value Proposition: Clearly articulate what makes the business unique. Highlight strengths, differentiators, and the value it brings to the market.
2. Progress to Date: Highlight key achievements and milestones, including growth metrics and significant customer acquisitions. Showcase accomplishments that set the business apart.‍
3. Management Team: Showcase the experience and expertise of the leadership team driving the business forward.
4. Market Position: Illustrate the business’s position within its industry, including its competitive advantages and market share.
5. Product/Service Details: Provide a detailed explanation of the product, IP, its features, and its vision. Discuss how it meets market needs and the strategic direction for its future development.
6. Growth Potential: Outline strategic initiatives for growth, be it through market expansion, product development, or strategic partnerships. Explain how the business will get there.
7. Market Trends: Provide insights into market trends and how the business is positioned to capitalise on these trends.
8. Competitive Analysis: Offer a thorough analysis of the competitive landscape and how the business stands out.
9. Financial Performance: Provide an accurate and transparent view of the business’s financial health, including past performance and future projections.
10. Synergies: Identify potential synergies with prospective buyers or investors that can create additional value, if applicable. This point may be better suited for the cover email.
11. Uses of Funds: If it’s a capital raising, outline how the raised funds will be utilised. Highlight planned investments in growth initiatives, operational improvements, or strategic projects, and explain the expected impact on the business’s trajectory.
12. Background: Offer a brief history of the business, including its founding, mission, and key milestones. Explain the journey that has led to its current position.

These, among many other considerations, are carefully evaluated when drafting the information memorandum to ensure a comprehensive and compelling presentation to potential investors or acquirers.