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My $100M Mistake + 6 Company Exit F**k Ups To Avoid

My First Million

Fri Nov 24 2023



Negotiating a Company Sale:

  • Understanding the rules of negotiating when selling a company is crucial for successful transactions.
  • Emphasizing the significance of being able to walk away and not needing the deal, thus having more power in negotiations.

Considering Offers:

  • Highlighting the difference between the highest offer and the best offer when selling a company, emphasizing likelihood to close and dealing with high-quality people as crucial factors in determining the best offer.

Tax Benefits in Business Sales:

  • Discussing Qualified Small Business Stock (QSBS) as a significant tax-saving opportunity for small business owners.
  • Explaining the eligibility criteria, holding period, and potential tax savings under QSBS.

Negotiation Strategy:

  • Assessing the likelihood of a deal closing and applying a discount factor to account for uncertainties.
  • Identifying the decision-maker within a company's hierarchy when negotiating with larger strategic companies.

Organizational Discipline in Business Transactions:

  • Emphasizing the critical role of organizational discipline during business transactions, such as selling a company, to ensure meticulous maintenance of all documents and records.
  • Highlighting challenges arising from disorganization, including difficulty retrieving essential documentation and potential negative impressions on professionalism.

Post-Sale Considerations:

  • Reflecting on the misconception of reaching a finish line after receiving an offer or securing funding, emphasizing the need to transition into an accelerated phase of action post-receiving offers or funds.

Negotiating the Sale:

  • Highlighted the time-consuming nature of finalizing a deal, emphasizing that it can take several months to secure payment after receiving an offer.
  • Emphasized the importance of presenting a well-organized and easily understandable data room to potential buyers, drawing parallels to selling a product on Amazon.

Financial Management for Potential Sale:

  • Stressed the significance of maintaining clean, simple books with legitimate tax records for long-term success and attracting potential buyers.
  • Shared cautionary tales about using company funds for personal expenses and the detrimental impact it can have on business valuation during a sale.

Importance of In-Person Meetings:

  • Shared anecdotes illustrating the value of in-person meetings for closing deals, highlighting how face-to-face interactions were pivotal in reviving and sealing significant business transactions.