One of the main duties of a business broker San Diego is to make sure you market your business extensively in order to attract the right buyers. What most people don’t know is that there are many types of buyers out there. If you are interested in selling your business, here are the six main types of buyers you should be familiar with.
This is usually another company that wants to acquire your business to achieve growth. These types of buyers look for businesses’ that are aligned with their core strategy and not characteristics like financial metrics. Business brokers San Diego recommend strategic buyers because you have a better chance of commanding a higher sale price. Strategic buyers often pay premium prices for businesses that align with their core strategies. This type of buyer is ideal if you want a lucrative exit and are not concerned about the future of your business and its employees.
These are investment vehicles for institutional investors or high net worth individuals. These are a good choice if you would want to retain a piece of your equity stake. These buyers simply inject money into the business in order to grow it. Your business broker San Diego will let you know if this is a suitable buyer for you or not.
These are more like private equity firms with the main difference being they inject the money of a wealthy family into a company to ensure that wealth spans many generations. Family offices take less active roles in a company and invest on longer time horizons unlike private equity that wants maximum profit within the shortest time possible.
These companies exist for the sole purpose of owning other companies. They generate revenue from dividends and earnings of stock they own in other businesses. Warren Buffett’s Berkshire Hathaway is a good example of a holding company. Holding companies will want a controlling stake in the business under their umbrellas. This means selling to a holding company is the easiest way to cash in equity.
This is an individual backed by a team of investors who are looking for a business to buy and take over operations. The individual can be a recent MBA graduate who wants to operate his/her own business. The individual’s team of investors will want to buy a business for the individual to operate.
Last but not least you must never ignore your employees when getting ready to sell your business. This is a viable option if you want to maintain your business’ current course in your absence. Your business brokers San Diego will help with this.