A guide to finding the best fit for your startup
Finding a buyer is a bit like finding a romantic partner: when you click, things just work.
You want the best price, terms, and future for your business. The buyer wants to earn a return on their investment.
Below is how you can make both of those outcomes happen.
Would you like free and expert advice on the acquisition process and how to create the perfect listing? Let us know by emailing support@acquire.com.
1. Speak with interested buyers to find the right fit
Once your listing is live, interested buyers will request access to your startup’s private information to decide whether your business is worth acquiring.
Before acquisition talks get serious, get to know interested buyers and their goals.
- Look for the Verified identity badge on their profile, meaning they’ve successfully passed our ID checks, so you can feel safe that they are who they say they are.
- Check LinkedIn to ensure their background and experience backs up any claims they’ve made in their opening message (or will make later).
- Verify they have the skills and experience to earn a return on their investment. If you leave your business in good hands, everybody wins.
- Look for the Verified funds badge that indicates they have the capital to acquire your startup. You don't want to waste time with a buyer who can't close the acquisition.
2. Securely share more data as talks progress
Buyers might ask to view code, contracts, and other sensitive data to help them decide whether to pursue an acquisition with you (called initial due diligence).
We recommend asking buyers to sign a mutual NDA automatically with their requests for access so you can share data with confidence, available from your listing settings.
Now is also a good time to set up your data room:
- A data room is a virtual folder for sharing acquisition data.
- Create and populate your data room now to save time later.
- Your data room lets you control access to sensitive details.
3. Lock in buyer interest with an acquisition timeline
Set deadlines for each stage of your acquisition up to and including a letter of intent (LOI). Without deadlines, you risk the acquisition stalling, but they must work for both of you.
For example, set deadlines for:
- Initial calls and light diligence
- Negotiations, final questions, and initial offers
- Receipt of the final, formal LOI
Communicate often and consistently to ensure your acquisition maintains momentum.
Evaluating buyers with Acquire.com founder, Andrew Gazdecki
Templates
Further reading
- How to Evaluate Potential Buyers for Your Business
- 10 Ways to Attract Startup Acquisition Offers
- How to Prepare for a Management Call With Potential Buyers of Your Startup
Glossary
Letter of intent (LOI)
A formal, written document indicating the terms a buyer is offering a seller in a proposed acquisition. Although not a contract, it is a document stating a serious intent, and may be legally binding in some circumstances. Consider the LOI as a starting point for negotiations.
Data room
A virtual, shareable folder where you store all the documents and data relating to your acquisition. As well as being a convenient way to share information, your data room allows you to retain control of sensitive data while moving forward with the acquisition.
Non-disclosure agreement (NDA)
Sometimes called a confidentiality clause, an NDA is a legal agreement between you and the buyer that prevents the buyer from sharing or disclosing information about your company to third parties or for other uses outside of an acquisition.